OK, it does seem that I am the only one suffering this issue and I also agree that it does look like a permissions problem. So I tried another few things:

1.
I re-checked that I was operating with Admin permissions and that RB itself was running 'as administrator'. Both are in the affirmative.

2.
I copied my song folder on to a USB device formatted as FAT32 so that I could at least ignore the permission. I loaded the SGU file and then saved. The save was supposed to default to SEQ but I'm asked about the Melody and Soloist tracks. I just OK to this and the file is saved, but there is no extension on the file, but it looks the size of the SEQ file so I tried to re-load it. Because there is no extension the file is not listed in the open dialog. I open the folder in Windows and manually add the extension. Now I can see the extension and open it. Yes, this is the tracks of the song I'd saved.I save this again and I see the components being saved, but once again I get the error regarding the inability of RB to overwrite the existing SEQ with the newly generated TMP file.
Someone mentioned about the possibility of my anti-virus so I disable it, removed the SEQ and TMP files, re-generated and saved. It's still the same.
I also opened up Event Viewer to look at Security, Application and System Logs, but no entries related to permissions failures.

3.
Now I move to my laptop, I install my 2021 version and set it up. I've now gone from Windows 10 to Windows 7 and I repeat all of item 2) with the same result, including the use of the FAT32 USB drive.

So basically I'm really getting nowhere, but at least I can work around the problem by deleting the old SEQ file before I save, a bit inconvenient but it works.

I have to say that the inability of RB to remove the old SEQ before it changes the newly saved TMP to an SEQ has only arisen since the 2021 version was installed.

But the requirement to actually enter the extension when saving for the first time as an SEQ after loading as an SGU has, in my recollection, always been the case.

Since no one else is suffering from this issue then something must be wrong on my side so I will now try to discover the problem. But I do thank all you good people who have given me suggestions for moving forward.