Target file name is
project1
lazarus is still putting .exe, .compiled, .ico, .lpi, .lpr, .lps, .o, .obj and .res in c:\lazarus.
but then having closed/restarted lazarus a couple of times, and then created a new project in another folder, all of a sudden everything was saved to the [correct] directory, project2. sometimes 'have you tried turning it off and then on again?' does work. thanks again, wp.