I\'m setting up a publish to a relative path for testing locally (especially xml config transformations). Each developer has their own path to the checked out project and I\
For Visual Studio 2012, this solution will not work. You should look at the answer by michielvoo just after this one.
After trying and trying I found the solution: you can use a relative path by setting
file:///./obj/publish
in the Publish WebApp dialog, but you must use a path that is already existent and writable by the user you are using. This way you can publish your web app in a local folder, or a path related folder.
Let me know if this helps. It did for me.