Yes, and this behaviour is why I asked for two different "copy" modes:
One that creates an actual duplicate (of the tags file, not necessarily of the mp3 file), and one that acts like the current "copy" that is actually only linking to the original.
Let's assume we have 3 MP3s with associated tag files, on the empeg these are files 10, 11, 20, 21, 30 and 31 (I am not sure right now, but let's assume the tag files are the ones ending in '0'). We also have playlist 101/100 which is the root playlist, containing songs 11/10 and 21/20, playlist 111/110 containing song 31/30 and playlist 120/121 which is empty. If I copy playlist 111/110 into playlist 121/120 using the existing mode, emplode just adds 111/110 to the running order of playlist 121/120. So, if I change any tags in the playlist 111/110 inside playlist 121/120, the changes also show up on the original playlist 111/110 just below the root playlist. The same applies to tags of song 31/30.
Using "deep copy", emplode would create a new playlist inside playlist 121/120 (let's just name it 131/130), which in turn contains a new copy of song 31/30's tag information (which I would name 41/30(sic) for now).
Now, you might ask why I create a new playlist, copying the contents of playlist 111/110 (i.e. copy both files), but only create a new tag file for the MP3s conatined therein. Here is the reason:
There are two things I can change about a playlist: The tag information (stored in the *0 file, following my assumption above) and the running order and contents of the playlist (which is stored in the *1 file). For music files, I can't change the music file itself, only the tag information about it.
All that is needed to allow this is an additional field in the tag files that allows explicit naming of the associated data file. So if a tag file X0 contains a line "datafile=<filename>", not the X1 file is associated with it, but <filename> is. If no such line is in the tag file, the normal X1 file is associated. This way, we do not need to create real duplicates of songs, but can still use different tags for different locations.
A third possible copy mode would be "deep copy of playlists only" which would not create new tag files for existing MP3 files, but would just create new copies of the playlist and it's sub-playlists. thinking about it, I think this mode would be easier to implement, and probably be used more often (very often by me).

mschrag: Any chance that you implement the third mode (deep copy of playlists only) as a possible copying mode in Jemplode (oooops, I mean Jempeg)?
guys@empeg: What about you?

cu,
sven