A deleted copy of this <File> file already exists in this project. Do you want to recover the existing file?

This warning has the following cause and solution:

When a file is deleted in a project, it is no longer displayed but it still exists. So when you attempt to add a file of the same name, VSS prompts you to decide if you want to recover the deleted file or add the one you indicated.
Click Yes if you want to recover the deleted file in the project, and not add the new file.
Click No if you want to the deleted file to remain deleted and add the new file.
Click Cancel if you want to abandon the operation.