I just tried something that seems to have fixed the problem:
In the Arduino IDE, I opened preferences, and refreshed the value for sketchbook location by clicking browse, and re-navigating to my preferred location (<D:\Files\Arduino>).
Now BLINK.ino compiles and uploads successfully to the UNO!
I'll try other sketches but I presume that the preferences were corrupt, and refreshing the file location cleared the corruption.