just to say that automated solutions exists :
this tool create all m3u files for each folder of the USB device.
Another tool can Album Art Downloader http://sourceforge.net/projects/album-art/
downloads automaticaly album arts and tag each mp3 with it, this album art will be displayed on the F20 screen
About USB drive, I use a 128GB SSD drive FAT32 formated and it works great with my 6NK PRO Radio system.