Right next to SH3.exe. They should be in .BMP format. But if you use one of those widescreen mods then they might interfere with making screenshots. I never used those myself, but have heard frequently about those kind of issues with screenshots.
However, if the game is installed into the default location in Program Files, than User Account Control part of Windows might prevent these files from being created there. While the game is running then you probably cannot acknowledge the UAC request for credentials, and the files will not be made. This can be avoided by not installing the game in the default location in Program Files. I can't remember (from previous posts) if this applies to you.
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