Hi, this is the first time I took notice of something
I am trying to compile scummvm
and after running ./configure i get:

Running ScummVM configure...
Looking for C++ compiler... g++
Checking for compiler version... 4.1.0, ok
Checking hosttype... linux-gnu
Checking endianness... little
Running on x86... yes
Alignment required... no
Type with 1 byte... char
Type with 2 bytes... short
Type with 4 bytes... int
Checking whether building plugins was requested... no
Checking for Ogg Vorbis... yes
Checking for Tremor... no (Ogg Vorbis/Tremor support is mutually exclusive)
Checking for FLAC >= 1.0.1... no
Checking for MAD... no
Checking for ALSA >= 0.9... yes
Checking for zlib... yes
Checking for libmpeg2 >= 0.3.2... no
Checking for libfluidsynth... no
Checking for nasm... not found

Engines:
SCUMM [v7 & v8 games] [HE70+ games]
Simon the Sorcerer
Beneath a Steel Sky
Broken Sword 1 (without mpeg2 cutscenes)
Broken Sword 2 (without mpeg2 cutscenes)
Flight of the Amazon Queen
SAGA
Legend of Kyrandia
Gobli*ns

Backend... sdl, HQ scalers, MT-32 emu
Looking for sdl-config... /usr/bin/sdl-config


And I intend to play Broken Sword 1 and 2, so I would ike the mpeg2 cutscenes, so I assumed the problem was with
Checking for libmpeg2 >= 0.3.2... no

But i check, libmpeg2 0.4.1 is actually installed, so why wasn't it found?

If packages are listed as missing by the configure script, make sure you have the devel (development) package installed. So in the case of libmpeg2, you would need to install something like libmpeg2-devel. The same applies for mad (libmad) and flac.

oh yeah, how dumb of me...
ok, now in the event I have all of the development package, not isntalled as part of the system, but available in some home directory, can you pass paramters to configure to make it use these files?
like libmpeg2? (i have the source + headers in a seperate tar which i have unpacked).

Install them using your package manager. Its a lot easier than what you are suggesting.

if you really want to pursue the custom paths route, try running ./configure --help. that'll spew out a load of information on how to pass options to tell configure where to look for certain things (as well as how to add extra functionality). as reddazz said, though, you're best off just installing them in the usual places.