When dealing with the timeline and the order of the final animation, the order of layers matters. The higher the layer in the stack, the higher the content will appear. It is like stacking several transparencies on an overhead projector.
One important difference between Photoshop and Flash is that in Photoshop if you click on a layer, that layer is active and selected until you select a different layer. In other words, if you try to click on content from a different layer, Photoshop will not change to the other layer. You would have to select the layer first.
Flash is different. When you select content on the stage, Flash will change to the layer the item is on - unless that layer is locked, at which time you would not be able to select the content.
It is important to minimize the number of items on each layer. Many animation types require that only one item be on the layer in order to properly animate.
Layers should also be named appropriately as at the moment of creation, your organization makes sense, however, 6 months from now when you need to edit a .fla file, the process might not make sense. By taking the time to plan, organize, and name layers, you will save yourself valuable time in the future.