Hi Vasanthi,
The folder structure is different from 8 to 9 versions.
You can use the old folder (theme/styles/web/sass) structure if you want, but you need to compile using calypso.
Or you can just use a new folder (themesource/atlas-core/web/...) structure.
No need for sass compilation for the new folder structure.
Note: Download the latest Atlas_core module from the app store and map it to the theme folder. Please refer the below image
Yes, Mx8 to 9 made a big improvement. Styling is now for more incorporated into Mendix Studio, the folder structure has changed, it now facilitates per-module-styling, and you no longer need Calypso. Any change to a scss-file gets compiled by studio immediately.
Here is the manual for moving from Atlas 2 to 3:
https://docs.mendix.com/refguide/moving-from-atlas-2-to-3/
https://medium.com/mendix/setting-up-your-modular-design-system-in-mendix-9-6-eed2d0063411
this might help
Sorry to see that Atlas 3 still has the old disclaimer pointing to the wrong folder:
//
// DISCLAIMER:
// Do not change this file because it is core styling.
// Customizing core files will make updating Atlas much more difficult in the future.
// To customize any core styling, copy the part you want to customize to styles/web/sass/app/ so the core styling is overwritten.
//