Hmmm... sound wired about the dir thing.. It works fine here...
But a good (though commercial) program is the XADmaster package.. the newest version supports many formats Zip inculded... And with the Voodoo-X GUI for it you'll be smoking

... Couldn't find it on aminet but try google for more info...
-edit-
renamed XPK to XAD, I always mix those two up...