Hi,
It does not matter where you put the files, but the best thing to do is to create a symlink in a shorter location. Firefly does not like long pathways:
ln -s /home/e-smith/files/ibays/music/html /music
Then configure firefly to read from the new location "/music"
Too bad iTunes10 will break "once again" the compatibility with firefly, and the project seems dead
Best,