In a LabVIEW project, when should I use virtual folder and when should I use auto-populated folder? Why?
2 Answers
You don't have to use either. Your project could just have a main VI and have everything else handled automatically as a dependency.
Personally, I would suggest viewing the project window as a logical organization tool for your work and say that you should only put the things you actually need or want to access from there.
The conclusion from this is that you should generally not use auto-pop folders, as you don't need that. If you want to see the disk hierarchy, you can go to the files tab in the project window.
You can use virtual folders for your logical organization. For example, you might want to have support files for your builds (like an icon for the EXE) and putting those in a folder cleans up the project. Another example might be that you have a library (like a class) and you want to group subitems in that library into some logical groups. You can create virtual folders inside that library.
The one place where I do use auto-pop. folders is if I have some dynamically loaded VIs or another list of files which are placed in the same folder. Adding that folder to the project as auto-pop allows it to be handled cleanly.

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It is your choice. How do you want to manage your files?
For myself, the answer is “never ever use auto-populating folders.” Those folders do not play well with libraries or classes (by design, not because of a bug), and they make it hard to remove items from a project but keep the files around (because deleting from the folder is automatically deleting from disk). There are plenty of others who agree with me. But they are nice for simple apps that don’t use any modern software design tools.

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