There are 2 problems here:
1. Because/while the MC client is downloading all of the thumbnails, it is unresponsive to playing tracks. In fact, MC seems to be frozen on the client. I know it is still active because it is using CPU and because the Server says it is receiving many, many requests for thumbnails. I'm hoping eventually the client will stop requesting thumbnails and allow me to play music again.
2. There's something less than good about the way the Library Server now handles thumbnails. The problem is that when I start up my client player it starts pulling down hundreds and hundreds of thumbnails to show in the playlist view. While this is good (i.e., I link the little thumbnails), it puts a big burden on the client, network, and server. Also, it appears to be downloading the thumbnails on a track-by-track basis even though they are often/usually album specific.
It would be somewhat better if it downloaded the folder.jpg file if that exists for all tracks in an album and only downloaded individual thumbnails if the folder.jpg doesn't exist. Even with this optimization, however, it will still be downloading hundreds of thumbnails for large libraries.