I organize my hard drive such that each project gets its own folder. Every skp, dwg, rvt, and other drawing/model file that I produce specific to that project (along with their backups) go into that folder. Other relevant documents go into subfolders. This eliminates any confusion about what goes with what project and makes searches for project-related files easy.
However, I usually have more than one project going at once. When I switch projects, I want SketchUp to look for files in, and save files to, the proper folder. Setting the "Start in" line in the shortcut should accomplish this goal. It does not. It can be done directly in SketchUp, though: just start SU, click on the "Window" drop down, click on "Preferences," click on "Files," manually change the "Models" location, click on "OK," shut SU down, and restart SU.
What SketchUp does is save the Models location - along with other things - to the registry. What the batch file does is change the registry before SU starts. By using a different shortcut to the batch file for each project, one need enter the path to the model folder only once.
Does that answer your question?