<pre>
> fossil set diff-command 'diff -u'
> fossil diff
...
sh: diff -u: command not found
</pre>

this happens in windows too.

This broke when I "fixed" ticket [8d073be8808b] -
settings don't support paths with spaces</i>.
The fix for [8d073be8808b] was put the entire "diff" command argument
in double-quotes so that it is treated as a single entity by system().

I suppose the right solution here is to require windows people with spaces
in their pathnames to add their own double-quotes around those paths.
Otherwise, there is no way (that I can see) to distinguish between spaces
in pathnames and separate arguments in a command.