Indexing directories of files ("Filepath on server")
You can also have directories of files on your server indexed periodically, using the type "Filepath on server".
Again, the options are either easy to understand or your can read more about them in the Context Sensitive Help.
Location: The Indexed Search configuration should be located on a not- in-menu page, just like the "External URL" type required. Same reasons; results are bound to a page in the page tree.
The process of indexing a directory of files is the same as for the external URL: For each directory a) all files are indexed and b) all sub-directories added to the crawler queue for later processing. This is shown in the crawler log:
When processing is done the result is shown in the Web > Info, "Indexed search":