I too noticed that some significant changes were made in this software update to how the car reads USB music. Contrary to your situation, I'm now really pleased that the car leaves the order of songs alone, whereas before it alphabetized them. Our different experience likely has to do with me not changing filenames. Specifically I use the "Folder" option for accessing music (vs artist, genre, song) as I have 30+gb on my USB drive and those methods create song lists too long to scroll through.
Overall it is still horrible accessing music (my 1st gen iPod in 2001 was better for organization/access, and songs cut out and back n every 30 seconds or so)), but at least it is a step in the right direction.
order of directories got completely random
order of songs in a directory, not sure: sometimes seems ok.
I wonder how hard it is to list filenames Or directory names) in alphabetical order (at least as an option): the thing tries to be clever by recognising artist, genre, (thing that are probably written in the properties of each file sometimes but sometimes not)... and fails miserably.
I even noticed it tries to order by surnames but displays by names: it's just a mess
I also have renamed all files by starting names with 01, 02, 03, 04... to make sure the list is correct but the system just ignores it.