>> where are leprechaun's generally supposed to live?

In your mind :-)

The little people generally live underground, often in mounds and cairns. Sometimes they have 'otherworld' cities in raths (often called fairy forts). We mortals don't seem to be able to see these unless walking home drunk from the pub :-) Most tales tell of people meeting the Gentry after falling asleep 'on the way home' in a rath or on a mound, where they are often enticed in by the sound of music and dancing ... riiiiiiiiight.