Note that this command permanently affects the file structure, unlike Scrivenings, which just creates a temporary combined view. Make sure to make a backup before reorganizing things on a large scale.
Could you tell us a little more about the problem you’re having with Compile, please? The Compile -> Contents pane will show which documents are included, the Compile -> Formatting pane defines which elements of those documents.
Since this project is a collection of ideas there are quite a few folders. There is a “draft folder” and I didn’t realize that the new folders I created were outside of this draft collection. The compile feature only shows documents inside the draft folder and nothing else, so I moved the other folders inside and everything is fine now.