Personally I find the mods and portraits being in the appdata folder convenient, it means fo each new versio ni can extrac tit to a fresh directory to avoid issues with th eold, and still have the old ready, but both will still use my portraits. You can change the folders it uses for portraits, bodies, and mods to be subfolders of the game if you wish.
Maybe it could be improved though to have a "directories" section in the settings to more easily access all 3 of these, and maybe have a shortcut button to use the current directory?
For the Windows release, the game could also include a shortcut to the %APPDATA%\Strive folder, and then people can just double click that to get there?