404 error on user create

Odd.
What is the (add user) path that gives a 404?

I can confirm the behavior. When I switch the path of the view back to admin/people2, the create path works again.

Looked into this.
Seems that you can't just override a system path, child items (like the "create" one) get messed up.
Your best bet is to download Administration menu, it comes with a module named "Administration views" that will replace all your system lists (content, people, comments, taxonomy) with VBO-enabled views. It implements a special views display plugin so that the child items continue to work.

Excellent. That will solve several problems for me at once :)

You can report that in the "Administration menu" issue queue.

took me some time to find this thread

I was looking for "Missing argument 2 for views_page() in views_page()" which is the actual warning message that comes up when visiting admin/people/create after changing the VBO user view to admin/people

just mentioning it just in case someone else is looking using previous phrase

This is likely the same issue I ran into with VBO for Drupal 6. The problem, I think, is that the Drupal core User module specifies only one callback function for the /admin/user/user path. With both /admin/user/user/list and /admin/user/user/create, they fall back to using that same callback function. When you take over that path with Views, the "admin/user/user/create" path's callback function is no longer found, since it's parent now has a different callback function.

The solution is simple: tell the /admin/user/user/create path where to find its callback function. Implement a hook_menu_alter in a custom module:

/**
 * Implementation of hook_menu_alter().
 */
function my_module_menu_alter(&$items) {
  // Re-point the /admin/user/user/create path back to the User module's
  // callback, since Views is taking over /admin/user/user.
  $items['admin/user/user/create']['page callback'] = 'user_admin';
}

By the way, in the view, I set the path to "admin/user/user/list" and set its menu item to be the "default menu tab" called "List". For its settings, I set its parent to be "Menu tab" named "Users". This results in the standard behavior from Core.

@jessehs thanks, YOU MAN, saved my life :o .

For Drupal 7, it should be this:

<?php
/**
 * Implementation of hook_menu_alter().
 */
function my_module_menu_alter(&$items) {
  // Re-point the /admin/user/user/create path back to the User module's
  // callback, since Views is taking over /admin/user/user.
  $items['admin/people/create']['page callback'] = 'user_admin';
  $items['admin/people/create']['file'] = 'user.admin.inc';
}
?>

+1 to @BarisW's code snippet above, though formatted a little more correctly/succinctly, it should be:

/**
 * Implements hook_menu_alter().
 */
function mymodule_menu_alter(&$items) {
  // Fix the admin/people/create, since this module overrides /admin/people.
  $items['admin/people/create']['page callback'] = 'user_admin';
  $items['admin/people/create']['file'] = 'user.admin.inc';
}