However, is some situations this does not work, iWeb will not show this dialogue box but create a new empty Domain.sites2 file.

The same problem appeared when I opened iWeb to continue working on a Domain file last saved outside the delault location. Normally iWeb should remember the last file opened, however it doesn’t do that very well. Sometimes iWeb remembers the file and sometimes it will act as if you opened it for the first time and create a new empty Domain file (see Note further on) .

So, don’t start by opening the application iWeb but double click on the file you want to work on.

You can create aliases if you want to open them from an other location. You can also drag the iWeb folder to the dock.

Note : the same goes when you want the domain.sites2 file outside it’s default location. When you open the application iWeb, it will create a new empty file in the default location... so you have to double click on the file at the location where you put it.

Ex.: you have 2 users on your computer and they both have to work on the same domain.sites2 file : move the file to the Users/Shared folder and set privileges for both users to Read & Write. Select the file, get info (⌘I)

When the first copy is ready, open it, make sure to delete all content, close it. Then use this empty file to make more copies. (It is important that you delete all content as iWeb will generate unique identifiers for some type of objects to work properly on MobileMe)

An other way to get a brand new Domain.sites2 file would be : Rename the original Domain.sites2 file,  open the application iWeb and it will create a new Domain.sites2 file in the default location.

From then on, do not open the application iWeb but double click on the .sites2 file you want to work on.

Do you want to work on a domain.site2 file from 2 (ore more) different computers ?

See Old Toad’s tutorial ‘Managing an iWeb Site From Two or More Macs with Dropbox’ here