Hello, I just want to share my findings.
First of all, Unreal wants to have a Public/Private file structure with the subfolders inside such in this post. If you select Public or Private and then put the folder name it will make the folder as well add it in the content manager. If you do it once, It will always default to ask you for making the class Public or Private
Now if for some reason don’t want to put the files in a Private/Public Structure
You can omit it but you need to do the following edit in the .cpp file.
If you made the X_Class in the Y_Folder, you will have the header
#include "Y_Folder/X_Class.h"
You need to either Remove the Y_Folder Or add the Z_RootFolder
#include "X_Class.h"
or
#include "Z_RootFolder/Y_Folder/X_Class.h"