I was archiving some of my email/mail boxes and made the mistake of not checking the "Include subfolders" box when I deleted an archived mailbox. The mailbox had about a dozen subfolders. The archived file has the main folder and contents, but of course does not include any of the subfolders.
I opened my Mail application on the desktop, opened Time Machine and found all of the subfolders that I had deleted. However when I highlight a folder and click on "Restore" the file is not restored. TM acts as if it's resorting it with a small "Restoring Mailbox mailbox name" as it goes back to my desktop, but the expected "Time Machine" folder is not created in Mail's sidebar under "On my Mac" per these instructions: