Configuring the Domain Mapping Plugin

In Tools/Domain Mapping it is asking for a Custom Domain for the member.

1. Is this the actual folder where their blog reside? i.e. http://my domain.com/blogs/theirs/? or http://my domain.com/clientblog/?

My domain that runs WPMU is an add on domain at my host
http://68.84.39.224/~topdomain/addon/
which I tested in my browser after installing the domain mapping tool following the direction and it brought me back to the main blog site home page.

2. What exactly do I enter for "A" record in this case? And again what goes in Custom Domain field?

I am testing an actual website http://www.realweb site.com