The latest beta of iTunes 9.2 available to developers lets you edit and manage the folders you create for your iPhone applications, according to TiPb.
Click on a folder icon and the virtual screen opens up to show the contents, same as in iOS proper. Drag an app out to remove it, or in normal view, drag it over another app to create a folder or an existing folder to add it in. You can even rename the folder if the "intelligent naming" isn't quite intelligent enough.
iTunes 9.2 is required to activate iOS 4.0 on your device.
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