I've created a Limewire Sharing folder on my computer, and I've put some files into it. Does this mean that someone else using Limewire can request that file and download it? Will that person actually be taking the file(s) directly from my computer? How does it exactly work? Someone please help me out with this! I'm a noob!

Only what's in your shared folders. Go to your LW Library window & what's in those folders you see will be shared. It means that if people are searching for a particular file, one of your files may show in their search results. To know for sure, look to the columns to the right. Hits shows how many times each file has been found in someone's search. Uploads shows how many times they have uploaded or attempted to upload your files. Concurrent uploads can be seen in the Monitor window at the bottom.

When you have LW open, the contents of your shared folder(s) will be available to other users. If you see the firewall icon (brick wall in front of the blue globe), other users will have a hard time downloading from you. There's some info here about how LW & the Gnutella network work.
LimeWire - Wikipedia, the free encyclopedia
Gnutella - Wikipedia, the free encyclopedia

People can only download files that you've chosen to share - so make sure that you're not sharing sensitive or private files. Before you start using LW, you should read through the LimeWire FAQ and User Guide