I have my index file standing alone in the "public html" folder, then all my images in a "'sitename' images" folder, and all my html files in a "'sitename' pages" folder. or something like this. Does the index file have to stand alone in the "public html" folder? Is this even the right place for it? How do I do this right (server side file heirarchy)?

You want to keep your index.html file in the public_html folder. That folder is the root folder for your domain and when someone types in your domain the server will automatically check the root folder for a file with the name index. If you move it you would need to also let the server know where to look for that file. Easiest though to just keep it in the root folder.

There are many ways you can structure your files and folders. You definitely want something that will be easy for you to understand so you can find what you're looking for as fast as possible. It can also depend on how large the site is and how large you anticipate it becoming.

If the site is only a few pages (say 10) and you think it will always remain that size then you could simply leave the html files in the root with the index file.

A popular way to organize things is to keep the index file in the root directory and then create a folder for every section of your site and place the files for that section in the appropriate folder. So the 'about' pages would all be in the about folder, the 'support' pages would all be in the supprt folder, etc.

Images will usually go in an images folder. Sometimes all the images for a site will be in one images folder that is in the root folder. Other sites will create images folders in each of the section folders and place the images for the sections in them.

Similar to image folders would be a folder for css stylesheets and one for any scripts you might use.

If you want to see how other sites organize things just pick a site and start clicking links and take a look at the url in the address bar for each page. It's pretty easy to tell how other sites have things set up that way.