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On Ubuntu (at least with 8.04 LTS) Tomcat is very nicely setup with CATALINA_HOME=/usr/share/tomcat5.5 and
CATALINA_BASE=/var/lib/tomcat5.5
That's great - but I like my config files to live on the same NFS mount as the web sites, which gets mounted onto /usr/local/sites.

The config files live in
$CATALINA_BASE/conf which in Ubunto would therefore be
/var/lib/tomcat5.5/conf

But since that folder is actually just a sym-link to
/etc/tomcat5.5 it is very easy to swap Ubuntu's default location for my preferred location...
sudo /etc/init.d/tomcat5.5 stop
cd /var/lib/tomcat5.5/
sudo rm conf
sudo ln -sf /usr/local/sites/etc/tomcat/conf/ conf
sudo /etc/init.d/tomcat5.5 start
We haven't lost anything - it's easy to put the sym link back to its default location if needed.