[Zubersoft]

I definitely do not think you should manually move the files unless you are a wizard with SQLite and don't mind updating the database yourself. One way to fix this that should work is to back up your library the way it is currently, then go to Settings->Clear Library. Make sure "Use Subdirectory Per Song" is unchecked in the storage settings, and then restore the backup file and let it restore to the default storage location. I believe this should restore all of the files into one directory (hopefully you don't have any naming conflicts).

Mike