It is more like you indicated above, with the actual path on DreamHost being:
/home/user/ (which is where you connect via FTP/SFTP)
Note that one DreamHost you can have multiple users at no additional cost, so you could choose to establish additional users, at which point your structure would be like this:
/home/youruser/ (which is where you connect via FTP/SFTP)
/home/anotheruser/ (which is where another user connects via FTP/SFTP)
and so on, and so forth, "scooby-dooby-doo"!