It turns out that there is an issue with selecting the package application during the actual packaging process. Between steps 6 and 7 above I needed to add another step whereby I had to select Never Generate app bundle and then it was able to upload the app and unpack it in Windows Phone Dev Center.
Previously I had only selected If needed or Always from the drop down list but by simply selecting Never it resolved my issue in trying to upload the package to Microsoft.
In the screenshot below I've highlighted (in a red box) the setting where the Generate app bundle had to be set to Never.
Hope this helps someone else because there was nothing anywhere on the web or SO around this error from MS.