In the Web Server I tab of the Database Properties, is the definition of "Default HTML Root" relative to where the database is, or relative to where the 4D application is located?
The Default HTML Root is relative to the active database structure file. You can use the following syntax to specify:

"Web Pages"
a folder called 'Web Pages' in the structure directory.

"Web Pages/Site One"
a subfolder 'Site One' inside of 'Web Pages' in the structure directory.

"../Web Site"
'..' means in the parent folder (up one dir) of the structure directory, in a folder called 'Web Site'.