Unlike IDE 1, when you choose 'Rename' in the top-right menu for an open sketch, IDE 2.0.2 allows you to relocate the renamed sketch to a different folder. If you do choose to do that, it does the rename and move OK, but leaves the parent folder of the original sketch behind rather than deleting it.
Hi @johnrippon. I did some experiments to try to reproduce this, but was not able to. For me, the previous folder is always deleted after I do a "Rename" on the primary sketch tab. The only exception was when I had the original sketch folder open in another application. That puts a "lock" on the folder, which prevents Arduino IDE from deleting it.
Which operating system are you using (e.g., "Windows")?
Are you seeing this with a specific sketch, or will it occur with any sketch?