You've run into a classic and frustrating quoting issue with the Drive API's query language. Your approach isn't wrong; you're hitting a limitation of the API's parser.

The Problem

The query parser has trouble distinguishing between the single quotes that delimit your search string and the literal single quotes that are part of the filename, especially when they appear at the very beginning or end of the name.

Your first query works because the quote is in the middle of the name:

name = 'test \' folder'

The parser correctly identifies test ' folder as the string literal.

Your second query fails because the escaped quotes are at the edges:

name = '\'test folder\''

The parser gets confused here and can't reliably interpret this as a search for the literal string 'test folder'.

The Solution

You are on the right track. The most reliable way to handle this specific edge case is to use the contains operator instead of the exact match =.

Here is the correct query:

Plaintext

'0AMbhVdUCBuc8Uk9PVC' in parents and name contains '\'test folder\'' and mimeType = 'application/vnd.google-apps.folder' and trashed = false

The contains operator seems to be more robust in handling these escaped characters.

Important Caveat: As you noted, contains can match substrings (e.g., it would also find a file named "'test folder' (copy)"). Your strategy of filtering the results on the client side after fetching them is the perfect way to ensure you get an exact match.

So, to summarize: Yes, this is a known issue, and your workaround of using contains and then filtering the results yourself is the correct and recommended approach.