I think I misspoke in my original post above because I was overwhelmed with the new look and features in version 2, and I want to correct it. SORRY.
If I open an encrypted document, make changes to it, and SAVE it, then AxCrypt overwrites that document back in the original folder.
If I open an encrypted document, make changes to it, and do a SAVE AS, then I need to make sure to select the proper folder where I want to save the newly changed document or else AxCrypt will put the SAVE AS document in the hidden AppData/Local/AxCrypt folder.
So, in retrospect, AxCrypt is working properly and the problem is with the operator – ME.