I'm not sure what you mean. There are no folders in object storage.
Wouldn't that cause problems when restoring from the object storage? How would the system know it would create a directory again?
Seafile stores folder as objects.
Yes I know. So if I understand it correctly, the folder structure will be lost on recovery?
No, not if you use seafile to restore the data (which you'll need anyway).
As I've said it stores folders as objects. I didn't say it doesn't store folders.