Guys I found the solution. It was the stupidest thing EVER.
I guess because of this cloud sync feature, for whatever reason mom's pw had the 'collections' features not enabled because it wasn't registered. As soon as I made her an Amazon account and registered it via the device boom! Right there in the main menu 'Create Collection'
My Kindle Keyboard is so much easier!
Anyway maybe this will be of some use to someone in the future. Cheers!
