Someone on reddit made folders work BUT instructions not 100% clear leaves enough out i dunno what to do (like where to make the sub directory etc etc)
"First, create a folder application folder. It will contain 3 files, the 2 image elements .png for the folder images you want to use, and the .desktop file. Inside the .desktop file make sure the Exec is "/bin/chmenu XXX". The XXX is the subfolder you will create to store the extra games. In the subfolder you create make sure you create a similar folder application element back to the original folder where XXX is 000. chmenu, located in /var/lib/hakchi/rootfs/bin, does need to be edited so that the snes does not crash by commenting out the lines related to the copyright symbolic link which does not exist anymore."