No my preference would be that those playlists made up of singles do not add them to 'My Library' as it's currently made up of whole albums. Or even have a toggle to display only full albums, much like you can toggle offline-only songs.
Even with your suggestion, it's not an issue if you used Search. I'm very organised and if I wanted a specific song, more often than not I'd know what playlist it was in.
I very rarely search by song title, simply because I generally don't remember song titles. I also rarely remember album title. Half of the time I don't even remember artist names. What again is the name of the artist/group where a young guy on a BMX bike is on the cover? It's a French group, music style is something fast in the direction of electronica. I discovered it through a Canadian podcast. Another similar band (or song?) is Mozart's Sister. Guess I have to flip through all the 200 covers in that playlist of music discovered via that podcast. If it where some more clearly delineated genre, I might start via that (Hip Hop and Rap is fairly clearly differentiated from other genres and I have sorted things even with more detail: a) 'Hip Hop' is Canadian hip hop or rap, b) 'Hip Hop/Rap' is other English-language hip hop or rap, stuff more voice-focussed, c) 'Hip-Hop' (note the hyphen) is French-language hip hop or rap, and d) 'Hip-Hop/Rap' is German hip hop or rap. Classical is another genre where it is very easy to guess correctly whether a song falls into in the category or not. But for most other genres, similar music could occur potentially in a pretty large number of genres.
So I hope you see, that not listing all songs (complete albums and singles) under an artist's name would make things significantly more difficult for me.
Edit: That song I was looking for was 'Time to Dance' by The Shoes.
I thought you could do this with Spotify, and clearly everyone is making comparisons with that!
Spotify could be made to show two separate 'libraries' (one with full albums and one with singles)? That would be news to me. Or Spotify being a separate library from the iTunes library? If the latter that is not really an achievement of Spotify but the free side-effect of coming from a different company.