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What you do with the directory structure on a Kobo device doesn't matter (as long as it doesn't start with a dot). When the device sees a book, it is processed and the details are added to an internal database. When using the UI to look at books, the details come from the database and do not include anything about the directory structure.
The book lists include filtering (all, unread, finished, reading and a few other things) and sorting (title, series, author, recent, date added, size, format). And you can search through your library. The search uses the title, author and series. Recent firmware has an Authors list. Selecting an author in the list shows all their books on the device. There are also collections. You can create the collection however you want. And book can be in as many collections as you like, or none.
The collections part is the only bit that isn't automatic. Putting a lot of books into collections on the device is slow an painful. If you use calibre, it can create the collections as the books are sent. And the collections can be made based on most columns. There is at least one other way to bulk create collections, one of which will use the directory structure.
So, to answer the question, "Why cant I/how can I organise books similar to that done on computer; directories.", you can't with the Kobo software. And personally, I don't want to. I haven't organised books on my computer like that for a long time.
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