To prepare, turn off automatic builds in Eclipse (otherwise, Eclipse is going to be really, really "helpful" by creating folders, modifying .classpath
etc.). Keep automatic builds off until you've at least finished step 2 (changing your configuration files.
Once you've changed the configuration files, close the project and open it again, then turn on the Eclipse builds again.
Here are the modifications you have to do to your project's layout, expressed in bash (as if your working directory is your project's root).