Trying the latest 1.5.0.135 beta and the nuget install action sets the working directory to whatever you specify as the output folder. That should not be the case as often the output folder will not exist yet; Nuget will create it when it installs packages. The working directory should probably be set to $Workspace$, that way we can be sure that it exists at runtime, and most users will not depend on it being set anyway.
Thanks, will fix for next beta build (monday).