Created a Configuration Label "TestCollection" - note case. This worked. Tried to apply it to a COU and got error "Characters allowed are a-z0-9- and the comma(,) separator_." I then renamed it to "testcollection" - all lower. I could then apply it to the COU. So, it looks like there is a different set of input validation being done.

Also, when I tried to create another label "TestCollection", there was an error "Label name already exists" even though the previous was changed to all lower case. Ergo, it looks like it is checking both latest value and the changelog records, perhaps.