If you have not read this thread, particularly the posts by Lord Of The Rings, I recomend it.
http://www.gnutellaforums.com/showth...773#post129773
If you still are having problems let us know.
I don't quite follow your post, but if you have iTunes set to automatically put files into folders by artist name, the files will dissapear from your iTunes file as such when they are added to the iTunes library and reappear in sub folders by artist name. opening the "get info" box will tell you where exactly any of your iTunes tunes is.