Facepalm... I found the 'List Options' menu... Why can't you access all settings from the main settings menu!??! Surely if I am able to set how folders can be sorted, I should be able to do this not only in the folder view but in the main settings menu also?!?!
So I updated the software on my Galaxy S2 and Poweramp stopped working. I reinstalled Poweramp, and it plays music again... But now all of the tracks are sorted alphabetically. Please help! I am very angry... I suppose I should add I always use the folder view and do not want to use the library view.