suppose tiles are store in file system like below image

roughly seen this url http://build-failed.blogspot.in/2012/11/zoomable-image-with-leaflet.html
see the code
var map = L.map('map').setView([0, 0], 2);
L.tileLayer('http://localhost/tiles/eso/0/0/0.png', {
minZoom: 1,
maxZoom: 6,
attribution: 'Testing',
tms: true
}).addTo(map);
from the above code it seems that loading tile 0/0/0.png means refer one tile. so my question is how leaflet will load so many tiles because this url http://localhost/tiles/eso/0/0/0.png refer one tile.
the above code is right?
the above code can load bunch of tiles ?
what setView([0, 0], 2); doing ? what is the meaning of 0,0 and 2 what does it mean ?
also tell me what the below code is trying to say
var map = L.map('map').setView([0, 0], 2);
L.tileLayer('eso/{z}/{x}/{y}.jpg', {
minZoom: 1,
maxZoom: 6,
attribution: 'ESO/INAF-VST/OmegaCAM',
tms: true
}).addTo(map);
in the above code we do not mention any value for z or for y or x ?
what approach i need to follow in real life ? do i need to specify value or leaf will provider value for z,y, and x at run time ?
please let me know. thanks