I do not see in your code that your File manipulation is actually finding the file. Did you read from the file or do a file.exists() or perhaps see what you get back with getAbsolutePath() or getCanonicalPath()?
Look at the log4j debug output...the classloaders are looking for config/logging.properties and cannot find it.
first (and most important): the problem is solved, this article helped me a lot. it was a classpath problem. i was unaware that eclipse seems to interfere the vm-args and needs its own configuraton variable. i don't know if this is for any good reasons, i found intellij-idea far more intuitive for the user
second: concerning your last answer, carol: well, my testcode actually was able to _read_ the whole file, line by line. but my assumption "if _i_ can the file, log4j can too" was wrong. i debugged into the logger, and found that log4j uses (better: tries) different classloaders and their getRessource() methods to load the file. And those fall back on the set class path, no matter if "/config" is reachable from with a eclipse java-program or not. i find this pretty strange... ;-)
many thanks for your help & greetings from berlin / germany, jan