We are seeing the same thing.. let me try to explain it differently...
Prior to 7.7.7 (we upgraded from 7.7.1 I think) if an FTP download task had the remote file filter location set to include subfolders, and the download destination "create relative server folder structure" UNchecked, it would create subfolders as they were picked up from the source. Now with 7.7.7 if that box unchecked, it downloads all the files to the destination with no folders created.
If you check the "create relative server folder structure" box, it creates the entire server file path, even if you are picking up from several folders down from the root. This is always how it worked before, but we never checked this box because we didn't want the extra folders showing up at the destination. When 7.7.7 was installed over 7.7.1, it appears to have checked the "create relative server folder structure" checkbox on all FTP download tasks where "include subfolders" was checked and "create relative server folder structure" checkbox was not already checked. This broke a number of our workflows because tasks downstream were no longer looking in the right place. When we realized the boxes had gotten checked with the upgrade, we unchecked them, only to discover that it no longer created the limited subfolders from where you picked them up, but just dumped everything into one place, and we had to redesign the workflows altogether to accomodate the change.
The regular File->Copy tasks have an extra option that seems like it should exist here too. Folder creation Radio buttons Create/Don't create subfolders, and a sub checkbox of "create full folder structure". If that same menu was on the FTP task that would fix it.