Where do I put it? I don't see an option/place for the variables.
Change the Copy Photos: popup menu to read "into folder with name"
Then in the Folder Name: text field enter your variables. If you want to create a folder hierarchy, use the '/' character to create it:
{year4}/{month0}/{day0}
Of course you don't have to create a folder hierarchy if you don't want to. Just leave out the slashes.
HTH,
-Kirk