Unable to add playlist or playlist folder in 3.5

Love the new UI (mostly), but when I try to add a playlist or a playlist folder, the folder ‘tree’ merely collapses, and nothing is created. I also lost some playlists and connection to some music files when I installed. The older version was not open during installation.

On a related topic, is there a new manual for 3.5? If so, how do I access it?

Any help would be very much appreciated.

What seems to be happening is that when I create a new playlist or playlist folder it appears at the bottom of the left-hand column, under iTunes Imported, but not in the ‘tree’ above, where I want it to be. I also have lost a substantial portion of the library in switching to 3.5.
Any fixes? I am not a computer person, so easy steps would be appreciated.

Solved. The lower tree (expanded) is the real tree.