Problems with SQL SET statements

First, what is the difference between

set option sqlpath = *libl

and

set path = *libl

at compile time (V5R3)? If I do the former, user defined functions are not resolved; with the latter, they are.

Secondly, SET SCHEMA isn't working. I specify it before declaring and opening a cursor, but DB2 doesn't find the files in the cursor because it is looking for them in a library with the same name as my group profile.
.