don't understand what you mean. SoD directory IS BG:EE directory. SoD is not standalone expansion but part of the BG:EE, so of course you should install mods on a game with SoD and use that folder for resource importation
I see what happened. I didn't realise the SoD folder contained a separate copy of the whole BG1 game. I installed the BGEE mods in the old (Pre SoD) Baldur's Gate EE folder, not the SoD one. I have now installed the BGEE mods into the SoD directory but EET is still not picking up Lydia in the inn. Do I have to start again and reinstall EET and all the other mods?
By the sound of it, yes. The procedure is, install SoD, install mods onto SoD. Then install BG2EE, install EET (this is where content and installed mods from BG1/SoD are imported), and any EET-compatible mods you want onto BG2EE. And then finally run the EET closer.
Like this http://gibberlings3.net/forums/index.php?showtopic=28245&page=2&do=findComment&comment=247030
All up and running thanks.