Using latest Xbian rc4 from 7/1/13.

Installed advanced launcher: Run it. Selecting standalone program, I only get the option to "XBMC HUB FUSION" and not to my root directory.

I have run the latest Raspbmc and the option to run a program from my root directory is present.

Is this done for a reason, or is it an oversight?

Oversight, to fix this: System -> File manager -> Add source -> Browse -> Root file system -> OK. Name : root -> Ok. Now root will be available again. Will also be fixed in Alpha 5.

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Done: https://github.com/xbianonpi/xbian/issues/252