The location for deployed applications is not engraved in granite. There's a standard location for deployments for Tomcat, though this can be overridden in the server.xml file, and if I remember aright, it's CATLINA_HOME/conf/Catalina/localhost (or CATALINA_BASE, I can't remember which is which). You can deploy Tomcat applications by dropping xml files in that directory. These xml files consist of <Context> elements as defined in the Tomcat docs. Oh well, how about I read the docs:
http://tomcat.apache.org/tomcat-5.5-doc/deployer-howto.html The docBase for a Context Descriptor can be any locally-addressable filesystem path, so it's quite valid to use something like "ECLIPSE_HOME/workspace/project1/build/webapp1" to point to the exploded WAR.
Actual behavior varies from release to release, but Tomcat 5 copies the application WAR from the indicates docBase to the CATALINA_HOME/webapps directory (and explodes it if it's a WAR file and not a directory). Tomcat4 could handle unexploded WARs, but it didn't have the Catalina/localhost deployment directory. The context Descriptors were placed in CATALINA_HOME/webapps, where they had an unfortunate habit of colliding with other files.