We are using labview 8.0, and it looks like it doesn't have that input yet - a snap of the context help for that vi is attached. I've not seen this vi automatically prompt the user - are you talking about a different vi?
Using the Create option won't work for many of our situations. We are writing tests in TestStand 3.5, and are going to be using the Microsoft Office toolkit as the means to generate reports for our tests using Excel. Often we'll have a spreadsheet template that the script will open, so we'd want to save the template, once filled with the new data, to a different filename. That's where I'd like it to be able to have some kind of error handling that can take care of a file that already exists...