All custom templates will go into includes/templates.
All other over-rides, like languages, will be placed into the respective folder(where the target file resides) within a subfolder named exactly as the custom template's folder.
This may cause confusion, but all template related over-rides like files borrowed from the default template... must go into your current custom template folder using the original named subfolders that the target files came from. Think of it as mirroring the directory... as it was in the default template, but all copied to your current template. If that makes any sense.
Eg. If you wanted to modify your store's browser name... you'd go into includes/languages/english and find the file "meta_tags.php". To properly over-ride changes... first you would make a new subfolder with your template name(folder name format) into the "english" folder. Then, you would make a copy of "meta_tags.php", open it up in a text editor, and make your changes. Finally, you would insert the modified copy of "meta_tags.php" into your newly created folder. Basic rule of thumb, where ever you see a subfolder named "classic"... you'd make your current template named folder there as well.
The easiest way to begin a custom template is to go into your original desktop fileset and locate the "classic" template folder, copy it to somewhere else, and re-name the folder "classic" to the new template name. From there, adjust the "template_info.php" file so the Zen engine recognizes a new template... find in "template_info.php";
Code:
$template_name = 'Classic Contemporary Green';
Change the template name, in red, to your new one. Don't forget to leave the surrounding quote marks in place, otherwise bad things will happen. When that's all finished upload your new template base folder(into includes/templates) and don't forget to set up the new template and sideboxes in Admin.