iTunes 9.2, currently in beta on the Mac, will be required to install iOS 4 for iPhone and iPod touch when it becomes available on June 21, and here's likely one of the reasons why -- it can edit Folders.
We've go a complete walkthrough of iOS 4 features up, but if you're curious as to how it works in iTunes, the good news is -- pretty much as you'd expect. Click on a folder icon and the virtual screen opens up to show the contents, same as in iOS proper. Drag an app out to remove it, or in normal view, drag it over another app to create a folder or an existing folder to add it in. You can even rename the folder if the "intelligent naming" isn't quite intelligent enough.
An obvious addition to iTunes 9's app management repertoire but the obvious stuff doesn't always get done. Nice to see, in this case, it did.
A release version of iTunes 9.2 should proceed iOS 4's availability.