I have the latest version of Android Studio (as of Sep 21, 2016). When I create a brand new project in Android Studio and try to build it, I am getting this build error:
There is a workaround. If you add the following to the project build.gradle file, inside the allprojects section, it will move the Build output files to this folder. Meaning the app will now build.:
buildDir = "C:/tmp/${rootProject.name}/${project.name}"
It does give you an additional app module at the root of the project but this is a much more convenient option than moving whole Project folder path.