You must have a minimum number of photos before they show up
You can configure that minimum now.
This makes it possible to have an album that contains only sub-albums, and stil have a cover photo; even a randomly changing coverphoto.
Set the minimum at 1 and upload 2 photos and you will see them in the album.
Have fun with it.
Oh, by the way, it is always a good idea to resize your photos so that they are no bigger than a reasonable screen before uploading. This will 1. reduce download time for the visitor, and 2. prevent the photos are stolen from you at a printable resolution.
You will find the photos in wp-content/uploads/wppa/[id].jpg
and the thumbnails in wp-content/uploads/wppa/thumbs/[id].jpg
The album structure is entirely stored in the WP database in two tables, one for the albums (name, description, parent, sort order method, coverphoto etc) and one for the photos (name, description, album they belong to, sort order sequence number etc).
By saving the photos itself by the id and extension (eg. 123.jpg, 124.png or 78.gif) you can have photos with the same name in an album, and move them to other albums (by the program's album management) without moving the files, but by changing the data in the database tables.
Warning: NEVER manually change anything in the upload directories, do everything by the admin panels.