If anything, iPhoto is the poster child for applications that do not need hierarchical file systems. Sometimes I want to have all photo's for a certain event, sometimes I want all photo's that are less than a year old, sometimes I want all photo's that have my cat on them, and so on. How does a tree-like organization of pictures facilitate making subselections like that?
You are just taking your allergy to applications that manage your files in ways that are incompatible with you messing around on the file system, and making an argument in favor of hierarchical file systems out of it.
I'm not saying nested folders fit everyone (although my anecdotal experience differs greatly from yours), but you don't have to be a geek or an old-timer to appreciate that your data is not tightly coupled to an app.
I don't know enough about new approach Apple has taken to comment directly upon it (yet). I do think original article was crap (and this one isn't great either).
As a developer and previous life as IT support I fully support the teaching the file system paradigm because it works better overall.
All of the tag resorting you are doing within iphoto can and is done rather easily within the file system as well so what has that added other then more complexity?
I don't like everything about iPhoto (it's database design is rather monolithic and not build for user that have many storage devices that are not always plugged in like external hard drives)
But I wanted to say: "hey, look here! We are already managing many files without folders."