As silly as it might seem, any sorting you do in the Organize Bookmarks window is temporary and for that Library window only. It doesn't affect the Bookmarks view in the Bookmarks Sidebar or in the Bookmarks Menubar drop-down. And as soon as you close the Library window that sort order resets; it doesn't hold for the next time you open the Library window.

See these support articles:
https://support.mozilla.com/en-US/kb/Sorting+bookmarks
http://kb.mozillazine.org/Sorting_and_rearranging_bookmarks_-_Firefox

As far as the Bookmarks Toolbar and the Bookmarks Sidebar go, the Bookmarks Toolbar Folder (all the way up at the top of the Sidebar list) is where the bookmarks that are on the Bookmarks Toolbar will appear. All other bookmarks are either in the Bookmarks Menu folder or the Unsorted Bookmarks folder.

Thanks for that speedy answer! Just to clarify, any urls that I drag into the bookmarks sidebar should show up when i go to the Organize Bookmarks window, is that correct?

Yes, that is correct. It should be in the folder that you placed it in.

If you do not see them in the Bookmarks Manager or sidebar correctly then you may have a problem with the places.sqlite database file.

See http://kb.mozillazine.org/Locked_or_damaged_places.sqlite