For each Web Application, there is a WEB-INF directory. Under this
directory, there are 1) web.xml; 2) \classes; 3) \lib and 4) tlds.
Under \classes, you can put all individual Java classes, incuding servlets and beans and other support classes; Under \lib, you can put .JAR file; Under \tlds, you can put all .TLD files. This is the convention. Pls do not break this convention. By following this convention, you DO NOT NEED set %CLASSPATH% for your Java classes.
It is not a good idea for you to add a layer called "\jsp" under
\WEB-INF\classes. I guess your examples work because you modified
the %CLASSPATH%. Evn=en your set-up works, please give it up.
My answer is based on TOMCAT 3.1 and 3.2. I am not sure what is the case in TOMCAT 4.0.