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Firstly - the Sony does not care about the directory structure you keep your books in. The directory structure Save template is unrelated to Sony Collections definition.
Secondly - Collections are set in the Sony PRST1 device interface driver, Prefs - Plugins - Device Interface - SONY PRS-T1 - Customize plugin in the box labeled 'Comma separated list of metadata fields ...', namely the box below the Save template box. If you want to use a custom column, such as your new genre column it needs a # in front, i.e. #genre. A standard calibre column doesn't need the #, e.g. tags
Thirdly - I'm not sure that the PRST1 even supports nested Collections. However, I've never used nested Collections myself, so I could be wrong.
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