OK, here are my points: 1. In DocumentRoot, there should be only 2 files: index.php and .htaccess, and one directory (drupal/). Nothing else. This allows other applications to coexist cleanly (without clutter) with drupal. 2. Under drupal/, there are two directories: core/ (with includes, modules, misc, ...etc.), and sites/. Anything under core/ should only be core Drupal, untouched by anyone, and hence easily upgradable. everything in core can be read only, and hence security is not an issue. 3. sites/ has configuration files with multi site setup (hostname, default, ...etc.), in addition to an "all/" directory, which is shared by all domains. 4. Each hostname directory, as well as all/ directory can have modules/ and themes/, files/ with site specific themes, modules, ...etc. 5. The current scheme of having .module, .inc and .css under one directory for a given module should continue. It works well. My only gripe is that many modules do not do a drupal_get_path(), and hardcode 'modules' in there. Now, moving to that scheme is a pain, and there are implications on CVS for older releases, but let us ignore that for a minute, and see if the reorganization itself has merits, and leave the "how to move to it" for later.