hi,
i was just looking at this - you should be able to re-organise files on a USB device as i just did it myself.
The restriction i have in place is the same as previously mentioned - it wont let you re-organise to a different drive. What you probably need to do is simply change the 'move files to folder' to refer to the drive and folder on the USB device - by default its set to the folder the music library is installed which is usually the C: drive