...
This section can add one or more "external" folders. This is currently only primarily used to source TGA and DDS files used for icons in the editor. The icons do not have to be 32x32 or anything, any TGA file is found. It would be recommended to have a good custom content folder structure with a folder for icons.
Note: The icons files in the external folders are added to the hakpack export if any project data is using them(see HAK Folder below). This can make adding an external folder containing other 2da files (eg ruleset.2da edits) for testing purposes. It's not recommended to add many other types of data in however.
The entire contents of the directories are checked - this means subfolders and all files. This can hang the toolset if there are too many files, so don't point it at tens of thousands of files.
...
HAK Folder: The folder that HAK files are exported to, these contain 2DA and SSF files, plus any icons if they are used and accessible from external foldersfiles in the External Folders. The hak folder in your Neverwinter Nights folder is suitable for this.
...