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I am using SQl Developer Version 188.8.131.52 (Build MAIN-13.80) on Windows XP.
Is there a way to change the path of SQL Developer files from C:\Documents and Settings\<myuser>\Application Data\SQL Developer?
Yes, see this post.
Basically you want to add this line to your sqldeveloper.conf file
And then set that to the directory you want to use.