yes, you're right.
I used "Total Commander/CE", and tried to set the hidden-attribute on a folder called "Musik", and selected "Recurse subdirs". Then I checked some subfolders an saw that the folders
were not marked "hidden" (that does work with "Total Commander 32" on my PCs). But after a reboot, HTC-Album didn't list any of the subfolders inside the "Musik"-folder. So I thought it was enough to mark the top-folder hidden to hide all subfolders, too.
I just checked the folder again and saw that Total-Commander/CE had marked all files
So it's not as easy as I thought.