The createProject CLI command can generate this error:

Contains: <path> overlaps the location of another project: '<another project>'

This error can occur even if there is no such project in the workspace directory it is being imported to. In these cases, the issue is because there is a reference to a project folder from the past in the workspace metadata cache. The workaround is to clear the cache.

The error message could be modified to be more clear on the actual issue.