Placing books in subdirectories does not have any advantages or disadvantages in terms of how the Aura handles them. Of course, using subdirectories may make it easier for you to manage your library from a computer. (For example: I have Calibre put everything under a directory called books. I will sometimes dump a file that isn't in my Calibre library into the root directory.)

As far as the user is concerned, the content on the SD card is handled in the same way as content in internal memory. The only difference is that the content disappears when the SD card is removed and reappears when the SD card is inserted.