Creating libraries in Arduino sketch folder

So what problems can there be?

Your constructor gets called when the object is instantiated. If that happens at global scope, it will happen before init() is called. You set the pin to be an OUTPUT pin. Then, init() gets called, and it KNOWS that pins are to be INPUT, so it changes the pin to an INPUT pin.

Then, your class tries to turn the LED on and off, and it won't be very bright.