I don't have a good idea about what you're trying to do, but yum repositories are actually very easy to set up. First, /etc/yum.repos.d/<anything>.repo will be read as a repository. I generally use base.repo, and avoid modifying the installed debug repository. Inside the repository file, entries have this form:
enabled=[0|1] tells yum whether or not to reference this repository.
gpgcheck=[0|1] tells yum whether or not to verify the GPG signature of the packages in the repository.
You can copy your RPM files to any directory you wish, provided yum can read from it. Then, provide the path in the baseurl value. If you are trying to manage several hosts, consider using Apache to set up an http file server on one host. Then, you can change baseurl and gpgkey to something like:
Finally, yum requires a "repodata" directory as a sub of the file location directory. Repodata is a set of XML files (and, optionally, an sqlite database) with information on the files available in the given packages, dependencies, etc. You create the repository by doing
[root]# createrepo -d .
(Note the cwd dot at the end of the createrepo command.) This will set up the repository for yum to use.
At the end, execute
[root]# yum repolist
to verify yum can correctly interact with your new repository.