Ok, so the 'infotainment Trade & Marketing Manager' at Mini UK has now confirmed to my dealer that the Music Collection, which is what Mini call the in-car hard drive, DOES NOT support playlists.
He also suggested that using the Favourites option in the system would give you the same outcome (it wouldn't: you would have a single Favourites folder, rather than the infinite playlists you can have on iTunes) and that this was a universal problem (it isn't; plenty of non Apple companies, like Sonos, seem to manage perfectly well). Slightly worrying, given the job title, but there you go.
So, despite having shelled out for it, I am going to ignore it, and go the same route as Hat: create individual USBs as set playlists, which I will keep in the glove box (well, maybe not in the glove box, as the piano black finish doesn't like to be touched. Possibly in the string net thing that is in the passenger footwell) and I will then fish out and plug in, as the mood/playlist takes me. Like others here, I also have a ton of music, in 50 odd playlists, so Kingston are going to be pleased)
And also use my Music on my iPhone, via Bluetooth, when the inevitable happens i.e. the labels fall off the USB sticks, as they scrum with one another in the string net)
Please do pass the word on to any prospective buyers: if you want to just carry on listening to music the way you currently do, get the enhanced Bluetooth with USB, which comes with the Chili Pack, and use your phone, or sticks as above. Spend £55 on TomTom for your iPhone, and use the £1175 that you will save on not having the Media/Navigation XL for other lovely goodies!