Question on kde menu structure?

[veezi]

I've been using kde for quite a while now. Still, I don't understand:

1. How does it generate the K menu items? Old .desktop and now .rc all confusing. Where exactly does kde look/scan for menu entries? Can its behaviour be changed or customized?

2. What's the purpose of these directories under '/usr/share'
apps
applnk
application
applications
It's even more confusing if you add to the mix similar directories under /usr/kde/3.3/

Any hint appreciated.