I can't tell if this has helped or not! As A reference:
Folder - a directory or folder on my Mac
Album - a group of Pics on my iPhone that have a 1 to 1 correspondence to a folder in a folder called Pictures on my Mac
Under each Album name on my iPhone there is a NOTE with this format: "# from my Mac", where the # is supposed to be the count of Pics in the Album and should be the same number as pics in the Folder on my Mac (inside the folder Pictures).
The folders on my Mac are in another folder called Pictures (as I said above). This folder is pointed to in iTunes and I have selected each folder to transfer pics to the iPhone. (yes, I manually selected over 3400 folders as you can't select them in any "normal" Mac way - such as with the Command key to select non-sequential items in a folder or the Shift key between selections in a folder.)
I have over 3400 Folders in the Photos folder on my Mac with over 120,000 items. I have some Albums in Photos on my iPhone that have the NOTE "0 from my Mac" but there are pics in that album! I also have some Albums on my iPhone that have a NOTE "# from my Mac" that are NOT the right count of Pics! So far I've only found Albums that have either one of 3 possibilites of the NOTE: 1) "0 from my Mac", 2) "# from my Mac" where # is less than the actual count of Pics in the Album, 3) "# from my Mac" where # is the correct number of Pics in the Album. I have NOT yet found an Album with more pics in the NOTE than in the Album, but I've got 3400+ to check!