I am just guessing, I haven't done this before:

• use a PATH Reader on your sample folder, set Path Filter to *.fmw, set Recurse into Subfolders to Yes
• use a FeatureReader with Format set to FME Workspace (FMW) and Dataset to path_windows (or unix) attribute
• use a StringReplacer to replace the "C:\\whathever\\" part of the source_dataset attribute from Readers (and Writers) featuretype to your new path (U:\\your_path), leave the rest of the featuretypes unchanged
• use another StringReplacer to replace ".fmw" with "1.fmw" on the path_windows attribute
• use a FeatureWriter set to Format: XML and Dataset: path_windows attribute (it will have a 1 in the name now)

There is a "minor" problem with setting the schema but I hope someone with more xml experience will suggest some improvements.

Best of luck!

Thank you for your kind response. Finished the course on Friday, fortunately, before the course started the host helped anyone in setting up their reader's and writer's paths, actually with FME it was nothing too duanting, once you understand how FME works. The course itself was very useful and I can see this being used with most companies in the future - it's that powerful. I 100% recommend it for anyone who has to convert data from one formate to another, or just migrate it and validate in the process. 20 years ago I did a GIS course and to be honest, as a CAD user, it was not by cup-of-tea. FME is far more powerful and versertil compared to GIS, in fact my colleague who does both GIS and FME said he spends more time using FME over GIS once he learned how to use the software, hence why I decided to do the course myself.