I was having some trouble with that myself. For some reason it just wasn't working well with making it a zip file. First, what I found works (at least with me) is using something like this to change the extension.

Sometimes it gets messed up with adding .zip or .lwtp and getting it to change back, especially if you designate an app to open it. If you can't get it to work with .zip and you have WinRAR, try that. That is how it works for me.

Generic_theme.lwtp-->Generic_theme.rar-->extract-->edit-->your_theme.rar-->your_theme.lwtp

And don't forget to compress/archive the files INSIDE the folder, not the folder with the files in it.