I was looking for a solution internal to ArcGIS. Maybe I'm wrong but the link you posted utilized ResEdit and that won't work for my needs.
I'm wondering if one can change the location of the default geodatabase and the home folder too by using Python.
I didn't find an accessible solution for v10 arcpy, however in Pro it's available out of the box as arcpy.mp.ArcGISProject().defaultGeodatabase.
See ArcGISProject—ArcPy | ArcGIS Desktop and file geodatabase - Setting default gdb from ArcPy? - Geographic Information Systems Stack Exchange for more
I would like an answer to this as well, regarding ArcGIS Desktop. I posted a new question at the link below asking a similar question.
This next link is helpful but it does not address Geoprocessing Environment Settings > Default Geodatabase and Scratch Geodatabase.