Media files can only be placed into a folder during the upload process. Image/Media paths are different for images in folders versus those that are not -- unfortunately, image paths do not update when the image is moved. Moving the image would cause the path to break and potentially create a poor subscriber experience if that image was used in an email.
To keep this from happening, we disabled the ability to move images to and from folders.
Please see here how the image path is different for an image that is not in a folder versus one that is: