I'm having the same problem: DNN 4.0.02, clean install, on localhost, source package, DesktopModules are not available in Module Definition from host login (or admin login).  I remember a post saying the problem is cleared up by adding an alias, but even with a lot of reading of docs and posts I'm having trouble understanding aliases (the material is either too simple or too technical, eg goes into parent/child issues), and this should not be an issue from the perspective of host (I think).  I tried "Upload Custom Module" for Announcements (DNN_Announcements.dnn) but get an error message that the module file is invalid, even though the "Validate" action says it's Ok. I read a post that said all the files in the module have to be located and zipped, then uploaded, one at a time.  There must be an easier way. Thank you.

Got it working thanks.  It was because I had setup the system locally and then uploaded everything, which means the modules were not in the installation directory to install.  Copied them there and then installed using the url that you mentioned above and its all working great.

Thanks! :)