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Up until recently, I too was a little bewildered.
In my case, I have two instances of MyAlbum for two seperate tpyes of reporting. I didn't realise it, but I'd set one to use GD and the other to use ImageMagik. The one using GD had appauling thumbs, while the one using ImageMagik was as sharp as a nail.
Once I changed the other instance of MyAlbum to use ImageMagik and rebuilt the thumbs, it was great.
Regarding the 'path' to imagemagik. I too wanted to knwo this and did ask my host. They told me there is no such 'path' - you just tell your system to use it and it automatically calls ImageMAgik from the server. In my case, in the settings of MyAlbum, I just told it to use ImageMagik instead of GD and it worked.