In this directory you'll find three kinds of files:

1) vmlinuz  (This is the Linux kernel)

2) kernel-modules.sfs  (This is a squashfs file system that contains the kernel modules and firmware. Normally found inside Fatdog's initrd.)

3) vmlinuz-initrd (This is the Linux kernel with the kernel-modules.sfs and init script compiled inside. When this boots, it will search for 
   fd64.sfs in the root of your partitions. Use the basesfs= boot parameter to specify the location of fd64.sfs. See the FAQs boot options for more info.)