Forget M3U playlists, they do not work with subfolders. drlucky must have a different O.S. to the general public.
Connect to the computer in MTP mode.
Select & right click a track to include in your list & select Create Playlist.
Rename the New Playlist.pla as Your List.pla.
Move Your List.pla to the Playlists folder.
Click Your List.pla & click Reference tab.
Left drag other tracks to add to the Reference tab.
When finished click OK.
Disconnect from the computer & Your List.pla will now play across subfolders.
As of O.S. 02.36.03 I can’t get this to work into the microSD card.