I'd like to see playback centered on the directory, not a playlist. I store my music in directories named "<artist> - <album name>" with FLAC or WAV files stored inside named "<track number> - <track name>". This way you could simply navigate with four buttons: previous album / next album / previous track / next track plus a play / pause button.
Playback should be continuous. When the track of the album is finished it moves onto the next directory (they are alphabetically sorted).
I can get sort of this behavior in the current setup by turning on "automatically skip to next directory" but navigating is still a pain.
BTW I've programmed exactly this behavior in the
Digital Audio Player I've developed. In addition: I've programmed a "directory search" feature when you can quickly skip to directories based on its first letter.