I just set my nano to only sync one playlist then drag and drop albums in and out of that, works for me.
It's 7.0.1 I'm running now. I installed it to see if it would cure the 7.0 bugs and to start with it was fine but after a couple of weeks it's gotten almost as bad as 7.0 was again. It crashes on closing almost every time too and it refuses to upgrade the firmware on my iPod ("Unknown error 1417") unless I manually stop the ipod with the "Safely remove hardware" systray thing, unplug and reconnect it when the progress bar is stuck on 0. Still a long way off acceptable IMHO.