The usual way of running games is pointing rpcs3 to the directory or installing it, if it is a.
Put disc dumps into the disc directory and the downloaded ones into the game directory. It differentiates between disc dumps and downloaded (PSN) games. RPCS3 stores its data in $XDG_CONFIG_HOME/rpcs3.
See the RPCS3 Wiki article Validating PlayStation 3 game dumps for instructions on checking the validity of a game dump. Note: Make sure to use an unmodified game dump.
