David-
The most important thing to understand about Lightroom is that all your changes - and the photos you're able to see and work with - are referenced from within a database file.
Catalog = Database = Library in Lightroom terminology. All the same thing.
The database is a SQLite file that can exist anywhere on your hard drive, but on the initial installation, Lightroom will use the default location for the database:
Mac OS X
/userfolder/Pictures/Lightroom/
Windows
My Documents > My Pictures > Adobe Lightroom
With this in mind, consider that it's possible to have multiple databases, each containing potentially different images with different edits made to them.
It sounds to me like you've launched Lightroom and inadvertently created or opened a new (or otherwise previously unused) database.
It's likely that your previous work remains intact; you just need to find it. If you hold the option/alt key when launching Lightroom, you can choose another database. Or, with Lightroom open, under the file menu, select Open Database.... the challenge will be finding your previous database(s).
Re: Folders - in Lightroom, the Folders list mirrors exactly the contents of the folders that you have imported, including names, locations, files etc. You can right click/control click and choose Synchronize folder if you think that Lightroom isn't showing you the current status of those folders/files.
If you move, rename or delete files and folder from within Lightroom, you these changes are generally also made directly to the contents of your disk drive. In the case of deleting iamge files, Lightroom will ask you if you want to actually move the file to the trash/recycle bin or just remove from the Lightroom database.
Folders that have been moved/renamed/deleted outside Lightroom will show in red. File that Lightroom can't find will have a "?" icon in their thumbnail, and you won't be able to take them into Develop.
The process of working on your files in Lightroom is confusing to many people, because of the whole database issue. If you've only worked with file browsers in the past, it takes some getting used to the idea that files can exist on your hard drive that are not in Lightroom, and managing the relationship between the actual files and the Lightroom Library can be confusing. But don't worry - you'll get it - it's a good system and will serve you well once you get the hang of it.
I want to go into more detail but my reply is already long-winded, it's late and I am tired, maybe someone else can chime in....