1) The file_api only interacts with the file system on the database server, so if the directory is created, it will be created on that server.
2) You need to output the return value of the function (ln_bool_dir1) to know if the call has been successful or not. If it returns "1" the operation was a success. If it returns "0" it was a failure.
3) You need to have the correct permissions on the file system to do this.
4) The JVM needs the correct permissions on the file system. See your thread about directory permissions here: viewtopic.php?f=1&t=13366