In many cases your process would work fine. Although, this could cause some path issues when you change a directory name.
What i do instead is set up a new directory at the root of my server for the new site i am creating. I will then finish building my site, or in the case of PowerStore, add all my products and modify the content. Then, when i'm ready to go live, i log into my Hosting Provider's control panel, open the Manage Domains/Domain Overview page, and edit the Destination for my domain to redirect to the new folder.
I only have 1&1 to use as an example, but here's the process:
1. Log into the 1&1 Control Panel.
2. Choose Manage Domains.
3. Select the checkbox next to the domain i want to use.
4. Choose the Destination down arrow, and select Edit Destination.
5. From the Existing directory menu, choose the new folder where you have developed your site.
6. Click OK.
Now, when you navigate to that domain, it will go to the new site instead of whatever you had set previously.
So, if I understand you correctly, when development is done just point the site to the new directory whatever the name?
Does that raise any issues with what you said here:
"…when ready to go live. This won't be possible if you plan on using WebAssist extensions to modify a dynamic piece of functionality (i.e. Menu Writer menu/eCart functionality),…"
will I still be able to maintain said dynamic functionality?
If not, is the fix simply making sure all the paths are correct?