I have a project that uses jar directories as module libraries (the directories are populated via ant/ivy). This works as expected when using the IDEA dependency storage format, but does not work when using eclipse-format dependency storage.

While everything seems find after first changing formats, upon reloading the project, none of the jar files in the directories are found.

Looking at the .classpath file shows that both class directories and jar directories are represented the same way:
Jar directory: <classpathentry kind="lib" path="target/external-deps" />

class directory <classpathentry kind="lib" path="D:/workspace/classes" />

I am guessing that any jar directory dependency that gets saved to .classpath is converted to a class directory dependency on reload.

This leaves me having to choose between jar directories and eclipse interop, both of which I find very valuable.

Issue was resolved