Albums get created by syncing over photos from your computer. You should be taking photos off your camera roll as it is not meant for long term storage.
Once on your computer you sync them over based on your settings in iTunes.
I only know about Windows machines.
You point iTunes to a folder where your pictures are stored.
Lets just say it is:
C:\PICTURES
Then in that folder you make other folders like:
C:\PICTURES\WIFE
C:\PICTURES\KIDS
C:\PICTURES\FRIENDS
C:\PICTURES\VACATION
Thus it will make albums for each subfolder. Note it can only go one subfolder deep so you cannot have C:\PICTURES\KIDS\SON
http://manuals.info.apple.com/ also has this info.
Message was edited by: DaVBMan
