Do you want to hide individual images that appear in and Event or the Photos folder? Right-click on the image, and you'll find the Hide option. However, if you want to see what's been hidden, it's just a matter of going to the View menu - it's not a feature meant for privacy, but just to conveniently avoid displaying an image.
iPhoto does not allow for the password-protection of individual Events, Folders, etc. So if your goal is to hide images from others who use the computer, you have an all-or-nothing proposition. If you place the iPhoto Library in the Pictures folder of your password-protected Home account, you'll have total privacy. If you leave it in the Root account's Pictures folder, all will be able to see it.
iPhoto is not an OS - if you want to physically shuffle files around from one folder to another, use Finder, and forget about iPhoto entirely. Finder is optimized for managing the generic contents of hard drives, network storage, and the like. iPhoto is a program specifically for organizing and editing photos in ways that are helpful to photographers. Each is optimized to a different purpose.
iPhoto imports photos to folders inside the iPhoto Library "package" (a group of folders and files that's meant to be left untouched by the casual user). Anything else you do - create new Albums, Events, etc. does not affect the original photo files, nor in which folders the original images reside within the package.
iPhoto and Aperture are also non-destructive image editors. When you make changes (whether it's cropping or placing the photo in an album), those changes are saved in data files. Nothing at all happens to the original image file. When you Export photos, whatever edits may have been made are applied on the way out the door.
The point of iPhoto's organizing system is to allow you to find the same image in as many ways as you wish, use the same image as often as you wish, without making multiple copies of the image file. Say you take a picture of your child playing soccer. Say you're also the unofficial team photographer. You create a folder dedicated to soccer photos, and you have another folder dedicated to photos of your child. Where do you put the file?
In Windows File Manager or OS X Finder, that photo could only be in one of those two folders unless you make a copy or an alias. In iPhoto, there's one copy of the image file, no matter how many albums, etc. have that same image. You can edit an image in iPhoto, no matter where you find it - and those edits will be seen in every other place the image can be found.
