You don't say which set of instructions you followed (and it helps to include that with your original post) but I strongly suspect you followed the instructions on how you move your media. Media alone are not a library and if you deleted your iTunes folder then you have deleted the database (the "library") that tells iTunes what you have in your collection, as well as playlists and a bunch of other things such as artwork files. If you use Time Machine you can recover the database from there. If not an all all you have are media files on your external drive then you will have to rebuild your playlists and everything else from scratch. When iTunes asks you to create a new file select to do so on the external drive, then drag your media files to the iTunes > Media folder >Automatically Add to iTunes in the newly created library folder.
In future:
How to do it --> Moving a library: Quick answer if you use iTunes' default preferences settings: Copy the entire iTunes folder (and in doing so all its sub-folders and files) intact to the other drive. Hold down the option (alt) key (shift on Windows) and open iTunes. At the prompt to create or choose a library choose the copied iTunes folder.
How not to do it --> iTunes for Mac: Moving your iTunes Media folder - http://support.apple.com/kb/HT1449
What are all those iTunes files? - http://www.macworld.com/article/139974/2009/04/itunes_files.html
