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The fact that I can see the books converted to EPUB in a separate directory but that that directory cannot be found when operating the Kobo Reader puzzles me.
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The Kobo doesn't display folders it simply looks for the eBooks loaded onto it and displays them in it's library under "My Books"
You can organize the books on your eReader by creating new "Collections" I categorize my books this way for example "Biography", "History", "Novels" these collections are virtual and don't change the way those books are stored on the eReader.