After an upgrade from 4.6 to 4.7, I see this. While it advertises 'variables' in the top right, they aren't used in the boxes below, and any other hardcoded path has been stripped out. The files seem to be working, is this correct?
Yes it appears to simply be using $civicrm_root (from the civicrm.settings.php) to look for these dirs! So as long as you have them in the usual places - this will work.
If you have a dir in a slightly different place or if you give it a different name - then you have to continue to be more specific [either specify exact path or construct it with the path variables]. I must do that for our projects for which we typically name and put the /extensions dir in a different place.