I know that I have modified backup files in the past (changing names of anonymized users so that they do not conflict with existing anonymized users), so I've definitely done it "correctly" at one point.
However, every time that I try to modify a backup file that contains a section name with a space (change it to ), I get an error when I try to restore it: "Unknown backup format: The selected file is not a valid Moodle backup file and can't be restored."
Do you need to do anything besides changing the "name" value in the corresponding section.xml file? I am very careful to mimic the backup structure (re-named ZIP file, with another ZIP file inside which has the file extension removed, with contents directly inside that file), so I am hoping that is not the issue!