Kaori is obviosly in a better position than myself to advise on the usage of her KaoriPatchGZ applet, however I'll give it a go.
The path itself is not as important as the WEMADE patcher, as Kaori cleverly utilises HTTP instead (also meaning you don't need an FTP server). If you have a webaddress like
http://www.nemesis-server.co.uk, and you have the klist file inside a directory called 'Patch', then inside the KaoriPatchGZ.ini you would enter for the gz config file;
KaoriPatchListFile=http://www.nemesis-server.co.uk/patch/!klist.gz
Now the webserver CPU/RAM usage is none of your concern, but bandwidth will be. I'm pretty sure your not sharing your connection so I'll leave it at that. Just remember its no different to hosting your website.
The patching applet itself which runs on all your players machines is a little different. Typically it runs BEFORE the game itself starts, so it shouldn't interfere with their gaming experiance. Your players will also need to have the Java virtual machine installed on their machine (imo, an unworthy pain in the arse)... which is why I typically recommened the WEMADE patcher for those motivated enough to use it.
All sorted? ^^
/Leo