1) Running a multi image plan with dawn flats coughed up an error during plan compilation, it said the defaultflat.txt was missing. But it and defaultdawnflat.txt were certainly in my
C:\Data\ACP Astronomy\Plans
folder, (I have My Documents mapped to C:\Data, could that be the problem?).
I copied the defaultdawnflat.txt file to the
C:\Program Files\ACP Obs Control\WebDocs\plans\ebenson
folder and it ran the plan again, this time it worked, why is that? The help docs specify it should be "in your default plans folder (typically My Documents\ACP Astronomy\Plans)." Is this just a case of the help file being out of date?
You were reading the help file for "in observatory"/console users but using the web browser with an explicit domain (other than localhost/ which are also "local"). Having started your run from what looks to ACP like a remote web session, ACP is going to use the plans folder that you (the logged-in user) have accessible from the browser. Also, the flat planning tools on the browser are the ones to use for making "standard" flat plans, and they are automagically put into the right place at the observatory/server end (the web user's plans folder). Of course you can also upload defaultflat plans, but using the browser is easier and less error prone.

2) AutoflatPlanGen was throwing an error
I apologize profusely for the existence of AutoflatPlanGen. It was deprecated years ago, and the info you saw in AutoFlatConfig is also no longer used by anything. That bad idea was in 5.1 original release, and it won't be in the about-to-be-released 6.0.

C:\Program Files\ACP Obs Control\WebDocs\plans\ebenson\last-plan-from-web.txt
So you used the Single Object Color Series web form. Had you just used the Setup Standard Sky Flats web form, you would not have become confused by trying to operate all over the place under the hood at the server end :-)) The flat plan needs to be in the same location as the observing plan (unless #dawnflat has a fully qualified path to the flat plan, very unusual and not the best idea!!!)

C:\Data\ACP Astronomy\Plans\defaultflat.txt
I'm not sure how this directory came into being. ACP's normal place (on XP) is C:\Documents and Settings\Your Name\My Documents\ACP Astronomy\...

But bottom line is... when you're using the web browser, use the tools and forms on the web browser. Don't go looking for the man behind the curtain :-))) Later, after you get familiar, and maybe want to do some exotic things, you should find the file storage conventions at the server are straightforward. One thing to note - on ACP6 the web document root is being moved out of Program Files.