Hmmm... I see now the problem only happens when I use the www in front of my url address. www.example.com/rsnews (rsnews is my hotaru main page subdirectory) redirects the browser to my wordpress blog main page at example.com. However, using example.com/rsnews without the leading www. correctly displays the hotaru home page at example.com/rsnews.
I'm guessing its because of the .htaccess statements on changing the domain from www.example.com to example.com?