Sharvey's answer was correct, but I also wanted to correct something from the original question, the part about .fxp files. Flash Builder 4 has not changed the format in which it stores projects; it still stores them as a directory with a .project file, a .actionScriptProperties file, and so on, just as Flex Builder 3 did. Where .fxp files come in is, they provide an easy way to package up a project into a single file and share it -- not only with other Flash Builder users, but also with users of Catalyst.
Catalyst is different from Flash Builder: .fxp files are its "native" format. So, suppose a designer created a project in Catalyst; you, the developer, could then import that .fxp file into Flash Builder using the "import FXP" command. When you do that, it unpacks the fxp into a traditional project format on disk.
Hope this helps clarify things! - Mike Morearty, Flash Builder team