Convert MP3 to Aiff

You can have your tunes in different folders by going to itunes prefs/advanced/general and turning off the options to organise and copy to an itunes folder. Personally I don't recommend it, but you have got the option.

It's not clear from your post whether you know this or not, but you can convert mp3's to AIFF in itunes. itunes prefs/advanced/importing and select import using AIFF, then in your library select the tune to convert and pull down the advanced menu and choose "convert selection to AIFF". Again I don't recommend this, you will have no more quality than an mp3 but a much bigger file.

Finally in your library, pull down the edit menu, select view options and check the "kind"option". This will display the kind of file in your library window. If you click on the list heading "kind" it will sort all your tunes by kind, starting with AAC (if you have any) because that is first alphabetically, click it again to show in reverse order. (you can do the same thing with any of the headings).

I rather suspect your quality increase by converting mp3's to AIFF is perceptive rather than actual.

AIFF files are indeed a much higher quality than mp3, but once something has been compressed as an mp3, all of the quality that an AIFF has and an mp3 doesn't has been thrown away during compression, converting the mp3 to an AIFF will not bring it back.

Now if you were to import as AIFF and convert to mp3 in itunes, there will be a difference in quality.

Why don't you create two Smart Folders in Finder?

One smart folder can contain files with the file extension .aif and the other smart folder can contain files with the file extension .mp3.

That seems like a lot less work.