I tried all the methods listed and the results are either printing the rar help file to the status window (meaning the proper parameters were not passed to rar.exe) or a *.rar file being created in ioFTPD/system dir with the contents of that dir in it.
I still cannot get the parameter for "all files in current dir" passed to rar.exe correctly. Even rar "this highlighted dir" would work but I can't get that passed to rar.exe as the proper parameter either. =\