Extreme example. Do you know how many releases of Elvis’ Christmas album there are with exactly the same track list? I have no idea! It’s been re-released multiple times on every type of tape, record, CD, and digital download.
Is there an option in Picard to tag a folder name with something denoting which media type it is?
Perhaps (CC) for Compact Cassette, (RR) for Reel to Reel, (8T) and (4T) for 8 Track and 4 Track tape, (45) (33) (78) for records, (DD) for Digital Download, (MD) for MiniDisc, etc.
If there’s a clash between two releases of the same album on the same media with all the same tracks, there should be an option to sort them by folder as
Elvis Christmas Album (CD) (1)
Elvis Christmas Album (CD) (2)
Dumping every media type of the same album into the same folder and appending (1), (2), (3) etc onto the track file names is a bad way to handle it.
Only multiple copies of exactly the same track from exactly the same release should be dumped into the same folder.
Do you mean coding media type into the folder name? I don’t think this information would be used.¹
But I don’t understand what you try to achieve. If you do Lookup or Scan from new files, Picard will find the best match for each of the files. “Other versions” can be selected from the drop-down list which has sufficient information about media type.
(Or do you mean media type submenus in this list? Of course, for albums with many releases, this would be advantageous)
If you talk about renaming/moving files you should make sure that you found the correct release before you hit Save and actually rename the files. And you should not process multiple releases of the same album at the same time.
EDIT:
Reading again, I think I understood what you meant with “tag a folder name with something denoting which media type” - it is possible to write the media type to the directory or file name when renaming, and this way distinguishing versions. 
EDIT2:
¹) It is also possible to use the initial directory name in the naming script (variable _dirname), using any media type information in it - this could prevent two releases with the same name.
You can do this in the file naming script (MusicBrainz Picard > Options > File Naming > Edit file naming script).
This is the script that I use that does that for some specific formats:
$noop([special format])$if($in(%media%,CD-R),[CD-R] )$if($in(%media%,8cm CD),[8cm CD] )$if($in(%media%,Cassette),[cassette] )
That will add the format to the folder name, e.g. Album name (CD-R)
This script only adds it for some formats - CD-R, 8cm CD and cassette. You can find the full list of %media% variables in MusicBrainz here, and add them to the script as you wish.
There’s lots of ways to do this. This post for instance has some other solutions. If you want to be reeeaallly specific you can add the release ID to the folder name.
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That sounds to me like you are setting Picard up to move files, but not checking the release that is matched. A classic issue you hit if you don’t manually check releases.
Personally I use the Catalogue Number in the Album Name in cases like this where I own multiple copies of the same album.