I have to say I don't get that info from the graphic I posted but...
The first line in that dialog asks:
The sources are required for browsing and code completion.
For example it has the file 'rtl/linux/system.pp'.
You see that the file system.pp includes the path rtl/linux.
So when you look at the perspective of
/home/pi/dec/fpc/3.0.0/ you can paste
rtl/linux/system.pp after it and you come to a valid file.
If you however give
/home/pi/dev/fpc/3.0.0/rtl/ as path you get
/home/pi/dec/fpc/3.0.0/rtl/rtl/linux/system.pp. Notice the double rtl/rtl/. That doesn't point to a valid file.
So if the question is "give a directory/path which should have the file dir1/dir2/file1.txt" you should point to the directory which contains that dir1 (and after that dir1 contains dir2 and dir2 contains file1.txt).