Does ticking the "output to the source file folder" not operate in exactly this fashion? I've not used it, but it sounds like it should.
I think OP is trying to duplicate the entire folder tree of the source file elsewhere, not just save the converted file in the original folder.
You can do this by setting a virtual tag that gets the part of the file path to duplicate and appending that to the root of where you want your converted files to go.
e.g.
My music is stored below the folder M:\Music.
I have virtual tag called
LossyPath that gets the file path part from a file being converted:
$RxSplit(<URL>,"M:\\Music|.flac|.mp3|.wav|.m4a",2)
So for the file:
M:\Music\D\Dream Theater\2005- Octavarium\01 - The Root of All Evil.flac
the tag value is
D\Dream Theater\2005- Octavarium\01 - The Root of All Evil
For your use, change the code to start with the root folder of your music and include any file extensions you have in your library.
Note the double backslash in the root folder path.
The code also removes the original file extension, otherwise MusicBee will create a file with a name like 'Track_Name.flac.mp3', which is probably not what you want.
In MusicBee's
File Converter, set the destination as
to a new folder, specify the Root folder for your mp3 library, and add the virtual tag as a sub-folder.
When it all gets put back together you'll end up with something like:
C:\MP3\D\Dream Theater\2005- Octavarium\01 - The Root of All Evil.mp3
Bee excellent to each other...