Guys correct me if i'm wrong. When a servlet is deployed, the servlet engine will look at the web.xml file of the application and builds a ServletConfig object and passes this object to the init function.
You are correct. ServletConfig has the servlet specific data from web.xml - ServletContext is also of interest in giving the "web application" specific data. You can find the complete set of rules which answer all questions like this for the servlet and JSP environments at java.sun.com in the form of some big .pdf files.