The trunk is the highest folder that contains your source code to build your project. I sometimes refer to this as "current". Think of it as your root folder.
The reason I asked about your folder structure is that I feared you put your branch inside your trunk.
When you make your branch, you want to make a peer (or a child to a peer) to your trunk.
I am not sure what purpose your development and release branches are for. I make branches for isolating a release candiate and I name them for their version numbers
e.g.
$/MyProject/Source/Current
$/MyProject/Source/Current/AssemblyA
$/MyProject/Source/Current/AssemblyB
$/MyProject/Source/1.0.334.0
$/MyProject/Source/1.0.334.0/AssemblyA
$/MyProject/Source/1.0.334.0/AssemblyB
$/MyProject/Source/1.0.512.0
$/MyProject/Source/1.0.512.0/AssemblyA
$/MyProject/Source/1.0.512.0/AssemblyB
As far your problem goes, I would make sure the workspace for your build only includes $/Testproject/Main, or $/Testproject/Development or $/Testproject/Release, but not more than one of them.
If you need to cloak, you set that up in your build's workspace definition. If within your main workspace for the build, you have subfolders you do not want in the build, nor to trigger the build, add another line to your workspace definition and point it the folders you want hidden, then change the dropdown from "Active" to "Cloaked".
This will make it so changes to that folder do not trigger the build (and the build will not pull that code).
Let me know if you need more help.