This is really annoying.. can anyone help please?

Hey all, I bought a black 8GB iPod Nano yesterday, so its the second generation one.
Heres the problem. My music is located inside C:/Music/ and I have songs in different folders and albums too with playlists.
Example:
C:/Music/Green Day/
C:/Music/Rick James/
Whenever I import playlists from the Green Day folder I can play it on my iTunes perfectly, then when I go and import a playlist from Rick James.. the files that are stored under the playlist for Green Day give me the message
"The song "blah" could not be used because the original file could not be found. Would you like to locate it?"
I've done some playing around and found out that importing playlists that are in seperate folders will not work, only the most recently added playlist will. and what I found out that worked is that if all the playlist and music files are all in the same folder.. iTunes would not lose them.
Is there any way around this, because all my music is seperated into folders and I dont want to make a new folder and copy all the music over just so the iPod can work with it.
Thanks in advance!

if you choose to do this, drag your songs over there, THEN erase them from your itunes library, becasue itunes wont be able to find the songs. After that, you can do
file > add folder to library > my documents/my music/itunes/itunes music, and it will automatically upload all those songs back onto your library

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