Another common problem is ppl who create the file on a Windows machine, then upload it to the router. The problem is that Windows and Linux editors use different EOL chars. And Linux can NOT read Windows files. It will just report not found.
You should always use a Linux compatible editor before uploading (e.g., notepad ++), and make sure the current format in the editor is Linux.
The telltale sign of this problem is when you dump the file, it's double spaced.
Verified the issue by checking the file with vi. Serves me right for shortcutting instructions. Will get the file on a different way and check it again.
To be fair, a file format error is not something I have ever come across when dealing with what appears to be plain text files, so there was little reason for me to think the error was anything to do with the editing process. Live and learn though.