The ROM folder  

Whenever a game produces a file (a save file, screenshot, Game Genie file, etc,) that file is saved in the ROM folder, which is located in ...\saves\[ROMname]\. From there, the files will also be loaded whenever they are needed again. This allows the user to customize each individual game by placing palette files, Game Genie codes, battery-save files, etc. in that folder. The new settings will override the default settings, which are located in ...\files\settings\.

Files saved in the ROM folder
battery.sav - Battery-backed RAM, can be used by most other emulators.
game genie.gen - A simple text file containing Game Genie codes.
quick.sst - Latest quick-save state.
save###.sst - Save state.
snap###.bmp - Screenshots.

Files loaded from the ROM folder
*.sav - The first .sav file found will be used as non-volatile data.
*.cfg - The first .cfg file found will replace the default settings.
*.gen - The first .gen file found will be used to import Game Genie codes.
*.pal - The first .pal file found will override the default palette.
*.ips - The first .ips patch found will be used to patch the loaded ROM.
*.sst - All .sst files found in the ROM folder will be displayed in the load game dialog.


Default settings for all games are loaded from the settings folder, located in ...\files\settings\.

Files saved in the settings folder
config.cfg - Button assignments, preferences, etc

Files loaded from the settings folder
*.cfg - The first .cfg file found will replace the internal default settings.
*.pal - The first .pal file found will override the internal default palette.