Recently we were stumped with the following error while working on an Azure project
Error 1 The specified path, file name, or both are too long. The fully qualified file name must be less than 260 characters, and the directory name must be less than 248 characters. C:\Program Files\MSBuild\Microsoft\Cloud Service\1.0\Visual Studio 10.0\Microsoft.CloudService.targets 202 5 OrderManagement
After a lot of head-banging, a simple Quick-Fix was to move the project to a root directory like a C: or a D: (Basically reduce the path of the project)
Hope you get to this quick-fix before you get to the head-banging 
Cennest!