Preferences: What should my source path look like if I have libraries?

Hi,

This has really been confusing me lately... I'd like to have a central location for classes I've downloaded that would be available to any new .fla document. I thought I had this setup correctly, but I'd like some confirmation.

I have a folder on my Desktop called Flash and in there another folder called ActionScript3, where I've got a com folder.

Does it matter which path I use. I thought Source path was the correct one. I don't remember if the $(LocalData)Classes was always in there, but I don't know if it should be removed. I guess I've monkey'd with these preferences enough not to remember.

What's the difference between Library path and Source path?

I've also noticed if I have any more classes than I already do I get the little ! exclamation warning in the Actions panel and my code hinting is disabled. I read a post at TheFlashBlog where Lee explains how to increase the preference. I did that, but it didn't work. Anyone else having that problem? (I'm on a Mac). See attached image for my Preference panel screenshot.

Thanks!

Dave K.