First, a correction: the parameter is "home", AOLserver's home directory.
I'm not sure where would be the best place to store your class declarations but I guess a -proc file in the tcl directory would work well. Check the files in xowiki/tcl, for example the Page class definition in xowoki-procs.tcl.
About absolute paths, something like /home/user/myfile.ext, check the api-doc to find some procs to get the server and package important directories, but you might not need this anyways :)