I found a similar issue/post here - http://drupal.org/node/140478
I have taxonomy terms that are hyphenated and others that are not, e.g:
a licences
-- a-1 licence
-- a-2 licence
When I try to use Term Name as an arg in my View I get problems - if I try the option "Transform spaces to dashes in URL" they work as long as there is no hyphen in the term - if there's a hyphen (eg a-1 licence) it removes ALL hyphens... of course the term does not exists and we get a 404.
What I'd like to know is if anyone is using a mix of both hyphenated and non-hyphenated taxonomy terms AND the Term Name argument in Views.
My view is pretty simple and has urls like "licences/%".
My current work-around is to use Term ID, but alias's don't appear to work with Term ID, so I have to use "licences/97" etc.