Is it posssible to make plahylists in the library on the pc in itunes?

i have been told that i shouldnt delete songs from my library even if i have converted them to my iphone device on the pc cause next time i will syns my ihpne to pc the songs will be deletred from my iphone as well.the list in the library under the music map gets too long so i want to organize those songs in different playlists.so my question is how do i do that?i tried to go to file and click on new playlist but that playlist shows up in the end.first u have library then store,iphone device,shared,genius ant then in the end playlists.so that playlist shows up here.so i wonder that is not under the library..so is those playlists a part of the library?i mean if i download a song here in the playlist category and not under the music map under the library will it be saved here when i convert that song to my iphone device.is this the same as library?cause i taught if i wanna make a playlist in the library it will show up under the library..
ok i dont know if this is understandable was difficult to explain but hope someone can help me here..
thanks

Step by step guide to how to create playlist.
http://ipod.about.com/od/itunesbasics/ss/making_playlist.htm
How to create "Smart Playlist":
http://support.apple.com/kb/HT1801
Tutorial about creating playlists.
http://www.apple.com/itunes/how-to/#video-playlists

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