Will check for sub-classes in core or libraries (which the original file is in) instead of always looking in libraries. Makes more sense to have them in the same folder wether in system or application.
diff --git a/system/core/Common.php b/system/core/Common.php
index 47293a1..6e2f725 100644
--- a/system/core/Common.php
+++ b/system/core/Common.php
@@ -142,13 +142,13 @@
 		}
 
 		// Is the request a class extension?  If so we load it too
-		if (file_exists(APPPATH.'libraries/'.config_item('subclass_prefix').$class.EXT))
+		if (file_exists(APPPATH.$directory.'/'.config_item('subclass_prefix').$class.EXT))
 		{	
 			$name = config_item('subclass_prefix').$class;
 	
 			if (class_exists($name) === FALSE)
 			{
-				require(APPPATH.'libraries/'.config_item('subclass_prefix').$class.EXT);
+				require(APPPATH.$directory.'/'.config_item('subclass_prefix').$class.EXT);
 			}
 		}