Re: how to rename music folders from id3 tags
banshee will keep your music folder organized and it has an option to use the format you requested too in "preferences>source specific>music>tick update file & folder name / folder hierarchy".
If you do decide to use banshee then for the intial addding of your current music I would use the option "preferences>source specific>copy files to media folder when importing", then move your music collection out of your music folder, empty your banshee library then reimport your music through banshee this will copy your music files back to your music folder. This sounds stupid but banshees music organiser is excellent at organising music you add through banshee but not so excellent at re-organising and moving an existing collection and this method will avoid getting a load of broken links in the banshee library and avoid empty folders in your music folder, banshee does have an annoying habit of doing that because the organiser won't remove empty directories
Catch me on Freenode - imark