Recommended Git directory structure

You can use any folder structure you want.

If you want to have
myproject
  |-- src
  |-- include

that's fine. You do (of course) not have to keep everything in one place.

The only thing is that (assuming myproject is your repo's root) you will have a .git folder there where your repo data is stored:
myproject
  |-- .git
  |-- src
  |-- include

Unlike the .svn folders in every folder of an SVN working copy, Git uses only this one folder to keep track of the repo.