ITunes Gone Haywire: Playlists, Folders, Settings and more

Question

Hello all. Man...I really need some sage advice in a bad way. I've been trying my best to conquer this major iTunes problem of mine, but ultimately, I have just not been able to find a working solution to fix it. Even my efforts at pinpointing the source of my troubles have been in vain. I've finally become exasperated enough that I decided I be better off trying my luck here. Any help would be very much appreciated.
THE PROBLEM(S): A couple months ago I was working on some music projects within iTunes, when something seemed to go awry, because it promptly started acting strangely, not like it normally did, and that's when I began to experience the problems. It had always run smoothly for me up until then, but it's been giving me major trouble ever since. Here's some of what's been going on:
Playlists gone haywire: My entire stable of folders and playlists has seemingly gone mad, doing all sorts of unfortunate and crazy things. I routinely get new waves of unwanted playlists and folders appearing in my library--some are exact duplicates of playlists and folders that already existed in my library, while others bear the same or similar titles, but are deformed in one way or another. Moreover, I'll often get a bunch of very old playlists reappear--ones that I had long since deleted from my library. Other times I will find that a whole bunch of the lists and folders have suddenly disappeared again, or sometimes their location will change. The worst of all is when, as happened a few times, I just completed a bunch of changes and modifications to the library's folders and playlists, or I was working on a music project in some lists, and then suddenly it all disappears into thin air a short time later (after a reboot of iTunes, for instance).
B) iTunes Library Files (itl, xml, genius, extras, and sentry): They refuse to nest in the main iTunes folder location they are supposed to reside in. Instead they insist on taking up residence in my Previous iTunes Libraries folder. I tried a few strategies I had come across here in the pages of the community, but none has worked to date.
C) Unstable Preference Settings: At least a few times I've logged on to iTunes to find that my usual settings and preferences have completely changed, causing problems. Sometimes it will change my iTunes Media folder location in Edit>Preferences>Advanced to another location (like to my Previous iTunes Libraries folder location), thus creating a new hierarchy of media folders therein. Also, my settings in View keep changing back and forth, my sources in Edit>Preferences>General had changed on me one time, and more.
MY CURRENT SETUP
-My PC: Dell Inc. Inspiron 580, Microsoft Windows 7 x64 Home Premium Edition, Service Pack 1 (Build 7601)
-iTunes 11.1.3.8
Library Size: 335 GB, 24,734 files, 13,056 folders
I'm an iTunes Match subscriber.
Current iTunes Media folder location via Edit>Preferences>Advanced tab: C:/Users/Dowgiert/Music/iTunes/iTunes Media. Both "Keep iTunes Media folder organized" and "Copy files to iTunes Media folder when adding to library" are currently checked.
Current folder path
Titles iTunes has chosen for my library files it uses: iTunes Library 2013-10-25 Extras, iTunes Library 2013-10-25 Genius, iTunes Library 2013-10-25 (.itl), iTunes Library 2013-10-25 (.xml), sentinel *See screen shot below.
Current location that iTunes uses for my library files (database .itl file, genius file, etc.) is: C:/Users/Dowgiert/Music/iTunes/Previous iTunes Libraries. The folder paths for these same files are: C:/Users/Dowgiert/My Music/iTunes/Previous iTunes Libraries.
-I also have an iPad 2, and a couple other iPods (classic and Nano). None of these currently has the iTunes library in the desired state (thus ruling out importing from them).
WHAT I'VE DONE SO FAR
-Backed up my library with SyncToy 2.1 (x64)
-I downloaded iTunes Folder Watch, however it doesn't seem to work until I fix the location of my .xml file.
-I've tried countless other fixes, changes to my software and PC, etc., but I won't list them all here now. Feel free to ask me more.
WHAT I'VE NOTICED
-It seems like these unpleasant library changes are often more likely (but not always) to coincide with one of the following: an iTunes update; an iTunes Match update; a Genius update; an iTunes shutdown, followed by a later restart of the program.
Again, thank you so much for any help. I'm really stuck. I have all sorts of other information at the ready, so feel free to ask if you have questions.
Forest

Answer 1

Hello again Mr. TuringTest2! Continued thanks for your help sir! I've long suspected that iTunes Match was partly responsible for my troubles, by the way. Let me update you on what's going on.
New Steps I've Taken:
-After your last response, I did the readings (thanks!), and then began by turning off my iTunes Match. From reading the post you provided on resetting iTunes Match, I got the impression that my order of operations should go as follows (please correct me if I'm wrong):
1st) Disable iTunes Match. [Completed]
2nd) Clean up my library [Started, but not completed*]
3rd) Try the Shift+ start iTunes Match technique to try and successfully clear away any harmful entries that might be saved in my Apple iCloud/iMatch database. [Incomplete]
4th) Restart iTunes and turn iTunes Match back on. Determine if the problems continue. [Incomplete]
*UPDATE: STEP 2 INTERRUPTED
I began clearing, moving, and modifying the playlists and folders that were the unwanted end-products of my recent troubles. I was making good progress cleaning up: Went from 258 playlists (regular) down to 200, and from 67 folders and subfolders down to 27. I hadn't yet deleted any of my 56 smart playlists, but did place them all into one folder (to organize them for later cutting).
Then came the hiccup. I didn't know clicking the button seen below on my account page would automatically turn iTunes Match back on, but it did:
Match ran it's usual 3-step process, and in just a few moments, undid the almost all of the aforementioned progress I had made. Of course, as it seems want to do, it added back a whole bunch of trash playlists and folders.
I ran a couple of your scripts to assess the damage. They showed that just by this accidental restart of iTunes Match alone, my library ballooned from 200 reg playlists/56 smart lists/27 folders, all the way up to new totals of 264/64/47!
When I returned to the problem today, first thing I did was turn iTunes Match off again. This resulted in dropping the totals to 235/63/47. I found that odd, so I did some more testing--turning Match on and off, each time recording the results. Here's all the recorded results in total numbers of regular playlists, smart playlists, and folder counts after each change:
Off:     200/56/27
On:     264/64/47
Off:     235/63/47
On:     285/64/48
Off:     256/63/48
On:     306/64/49
Off:     277/63/49
I ran your PlaylistToFile script each time after I turned iTunes Match off (it wouldn't run when I had Match on for some reason) and made copies of the results. I wanted to be able to see the specific changes being made each time, and to try and determine which specific playlists and folders were acting up. I you think taking a look at these results would be useful, I've copied them into a shared google document you can access at the following link:
-https://docs.google.com/document/d/1ESzfCpcO14krXp5sTQdMke0CpFDF--gbwVxrGaNmbgw/ edit?usp=sharing
I also noticed that iTunes started creating more backups of my library's database files within the Previous iTunes Libraries folder. Here's an image of the new ones:
Also, it appears iTunes created new .itl and .xml files in my main iTunes folder (see below). Or at least that's what the "Date Created" info column says. What up with that? Also, I still have the Trash folder here that you told me to set up, and a couple new .tmp files have appeared. Here's how it looks:
What do you think I should do tt2? If I had completed the four steps (outlined at top) without accidentally turning on Match before I all four were completed, would that have fixed the problem? Should I do something different, or in a different order? I'm all ears. Thank you so much for all your help!
Eternally grateful,
Forest