This seems to be a factual error in an otherwise very excellent review of the Apple iPhone:
Bookmarks are organized alphabetically with folders at the top. You can move folders up and down, but can’t reorganize bookmarks themselves. We were disappointed that you can’t edit existing bookmarks except to delete them, nor can you move them into a folder.
I don’t have time to check this now, but I’m pretty sure I was able to reorganize my bookmarks. I could move the positions of the bookamarks– most of them, but strangely not all– and put them into folders. I could also edit existing bookmarks to change the title. And in the edit screen, I could move them into a folder, and even nest folders as desired. What gives?