I've fixed this in b17 now. (The old logic didn't accept any mouse shaking)
b17 also lets you delete project groups if they reside under My Albums.
Can you clarify? I just managed to delete the empty 'Tests' group, which is not under 'My Albums'.
What matters isn't how the project groups are presented visually. What matters is where they reside on the hard disk. The "Tests" folder shows up next to "My Albums" visually (for convenience), but is actually located under "My Albums", hence it can be deleted instead of just unlisted.
I envision that the vast majority of those who use project groups will prefer a flat structure (one level of groups), it's however clever to physically store groups under a common root ("My Albums" for backup/restore purposes for instance. That's why "Samples", "Tests" and "Favorites" show up NEXT to "My Albums" but are physically stored UNDER it.
I anticipate that a minority will want to create deeper physical AND visual structures. They can use the sub group concept for that, for instance creating a "Clients" group, and populate it with sub groups for each client.