I have seen other (closed) posts about this from several years ago but nothing recently that I can find. I feel like this used to work better.
Regarding the Photos library - folders and sub-folders are displayed mixed within the library and not at the top (or even the bottom). They are mixed among all the photos in that particular folder being viewed.
In the web viewer I am able to sort by Albums which then responds like a folder view. It even changes the view name to “Folders” instead of “Albums”. It presents sub-folders first followed by photos (although with no thumbnails). This is normal behavior. But when sorting by Photos then all sub-folders are mixed among the photos, sometimes at the end.
In the IOS app, sorting by Albums results in non-functioning album icons that do nothing. In the web version these work but not in IOS. You cannot view the contents so this is basically broken.
I’ve attached screenshots to show this behavior. Proper behavior would be to display sub-folders first at the top of the page followed by all photos, not scattered within the photos.
1 - TOP: Web version sorted by Photos resulting is listing of folders with thumbnails - THIS IS NORMAL.
1 - BOTTOM: However, lower level folders (Cars, Bikes, Planes) will result in sub-folders (Wings Over Wayne) scattered among photos or at the bottom, not at the top. - NOT NORMAL; FOLDERS SHOULD BE AT TOP
2 - Web version sorted by Albums (which changes view name to Folders) resulting in listing of folders without thumbnails. Clicking them works normally - THIS IS NORMAL BUT SHOULD SHOW THUMBS
3 - Web version sorted by Albums drilled down to a sub-folder (Cars, Bikes, Planes) resulting in further sub-folders (Wings Over Wayne) at the top but without thumbnails. (NORMAL) Also note how view name says Folders and not Albums again.
4 - IOS app (most recent version) sorted by Photos showing top-level folders with thumbnails - NORMAL although there are no photos here, only folders
5 & 6 - IOS app sorted by Photos drilled down one folder level (Cars, Bikes, Planes) resulting in sub-folder (Wings Over Wayne) showing up at bottom, not at top where it should be. Other folders have sub-folders mixed among photos, not at top or bottom.
7 - IOS app sorted by Albums resulting in folder listing without thumbnails that doesn’t function. Tapping on them does nothing. In the web version they are functional but also without thumbs.
In summary - folders should be listed first, always. Or at least an option to be able to make that happen. I can swear this used to work fine. This shouldn’t affect timeline functionality. Its just another way to structure many existing folders of photos. Similar to normal folder structure. I hope this all makes sense. It took way longer to write-up than I had expected 
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