Don’t worry, you won’t screw the Clip up. And good practice/idea in keeping the original files on your computer!
Under the Clip’s settings, select format–that will erase the content on the Clip and you can start fresh.
You can organize your files on the Clip just like on your computer. Personally, I set the Clip’s USB mode (under settings) to MSC, in which the Clip then is seen and treated as a drive when connected to your computer. Then, I just copy my music folders over (each CD that I’ve ripped is in its own folder) and store it in the Clip’s Music folder, using copy and paste or drag and drop–no need for special software or WMP.
Note: as a general matter, the Clip uses ID3 tags for navigation and display on the screen–so best to have your files’ ID3 tags in order. A good tag editor (Internet freeware): MP3Tag; Windows also can be used to edit tags.
(Exceptions to the ID3 tag need: tagless files in the Clip’s Audiobooks and Podcasts folders will display the files’ folder and file names on the Clip’s display; also, files with the genre ID3 tag field set to Podcast or Audiobook, stored elsewhere on the Clip, will do similarly. Finally, you can navigate by folder and file name on the Clip+ (but not the original Clip), under the Folders option under the player’s Music listing, at the bottom.)