I use your config too. IMO its the best, although you don't really need the artwork as a file really. Its the embedded image that you want. But having the file in the foler not only burdens the system disk less, it also helps me set up admin views when I want to find and replace low rez art.
Some people use cover instead of folder, but folder is used in so many programs, I just continue to use it. Renaming the file can cause issues in some external programs .... not an issue if you stick just with JRiver of course, but its a pretty universal convention.
oh and yes its the embedded image written to the file container that you are seeing not the folder.jpg file