I notice several people have had the same problem I've had moving playlists into folders. You can drag the playlist over the folder and the + sign appears, but when you release,the playlist is just moved to the location before or after the folder, not inside it. You can't drag anything into the folder.
Spotify staff were not helpful to me on this. They just told me to reinstall which was of no help.
But I've noticed two things that may help others. First, Spotify apparently cannot move a playlist into a new, empty folder. You have to create a dummy playlist or sub-folder inside the folder first.
Second, the moving operation only works when you hover the cursor over the folder long enough for it to open and list its contents. Then you can move the playlist into the list where a green bar shows up.
I guess in a new folder, there's no list, so there's no place for the green bar to be located. Dumb, but that's how it works.
So if you want to put a playlist into a new folder, right click on that folder, then choose either create playlist or create folder so that the new folder is not empty. This will just be a dummy playlist or folder, you don't have to use it.
Then drag another playlist to the folder name until the little arrow on the right points down and the dummy playlist or folder shows. Keep dragging your playlist to a location before or after the dummy entry and a green bar will show up. Then you can drop the playlist.
Once there are any entries in the new folder drag-and-drop should work the same way for other playlists or folders. You can delete the dummy entry if you want.
I hope this is helpful to others. It does seem like Spotify should fix this problem by allowing stuff to be moved into a new folder. It is pretty common for users to want to create a new folder and place existing playlists into it.