Why would CopyEntity() return an invalid entity?

Strange..

Try with another entity which is not a sprite, like for example a cube.

Perhaps a sprite needs to be instantiated first:
p\sprite = createsprite()
p\sprite = copyentity(t\sprite)

How did you create the t\sprite one ? The same passes should be applied to p\sprite, I think.

I'm only guessing here, since I'm at office = no blitz

Hope this helps,
Sergio.