How Does Elements Store Photos?

Question

Is just gotten version 11 for the mac.  I imported one folder of images (which has subfolders) to try out the organizer.  I think I need to understand better what Elements is doing with my images before I proceed. 
When I look at the left pane, I see Albums (there are none yet) and My Folders.  There I see the folders of images that were imported.  They are all shown at the same level, with no subfolders.
This leads me to believe Organizer is not actually making copies of my images and importing them, but merely creating a catalogue that points to them.  Do I have that right?  I can use Albums to organize the photos, but once again, the Albums won't contain the photos, but only point to them, correct?
My photos are woefully organized in folders on my hard drive.  I'm almost thinking that before I import into Elements, I should get my folders organized and cleaned up outside of Elements.  Even though I could have good Album structure in Elements. it bothers me that down there at the actual folder level, it's all a piece of @#%&.  Can I use Organizer to do that folder organizing even before I start the Album organizing?
How does Elements handle editing of images?  iPhoto (which copies photos into its catalog), keeps a version of the original when editing is done.  Does Elements do that, or is there only one version of IMG_001 no matter how many edits are applied to it?
If the images are kept in my original folder structure and I edit an image outside of Elements, when I open the image in Elements, do I get the edited image?
I'm trying to decide between iPhoto and Elements, mainly for organizing purposes, so answers to these questions will help me decide.  I appreciate your help.

Answer 1

Under normal circumstances, the organizer is just a database: it merely makes entries for the photos you import, without copying anything. The one exception is the "from iphoto" command, which duplicates the photos in your iphoto library in another location (although, again, the copies are not stored "in" PSE). The reason for this is that poking around at the iphoto library from outside iphoto is a sure way to eventually corrupt the library and lose the photos it contains.
If a photo is in the organizer, you can save as many PSE versions as you like. This is one advantage that organizer has over iphoto. You also have access to all the versions all the time (unlike iphoto where you must lose your edited version to get back to the original.) Overall, I would not say that organizer is a clear winner over iphoto, but this is probably the biggest point on its side in the debate.