Folder Settings specify the location that FileLocator Lite stores its configuration and log files.
The default locations are:
$(ApplicationData)\logs\
$(ApplicationData)\config\
The $(InstallFolder) macro evaluates to the installation location of FileLocator Lite, e.g.
C:\Program Files\Mythicsoft\FileLocator Lite
The information changed in this dialog is stored in the master.xml file located in the root of the FileLocator Lite installation folder.