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[Kelly]

I was reading the Naplink Demo Disk Swap tutorial and while I was following along carefully on every step, I encountered a problem.

In step four, it lists the contents of what files and directories need to be added to the CDRWIN project. The last item, a directory called SCEE_DD was not mentioned in any other part of the tutorial.

What is this directory and where can I get it?

[ole]

You can find this directory on your ps2 demo disc, so if you didn't found it then you don't have the correct (means described in tutorial) demo disk.
In that tutorial the "PAL demo disk" is refering to disk that is bundled with PS2. If you bought the ps2 you should have the "demo disc" :-)