If you create an article named Foo in the same folder as a subfolder named Foo, the article will get renamed to Foo2.html when you publish your site. Joel Spolsky gives this explanation:
"It's a bit tricky but if you have a folder named index we don't let articles have the basename index, because we can't be sure you won't add a template family in the future with no extension which would cause a name conflict. So in general, right now, where articles are concerned, we err on the side of safety and don't let you reuse the same basename. But generating unique publishAs names is sort of a big logical morass :) If you're ever trying to debug something like this, pop open your site in Access and look at the sPublishAs field in the tblStructure table."
The Pool-Room: CityDesk FAQ