You can now create folders for photos in your camera roll on the iPad (since iOS 5.X.X). However, if you're hoping to move photos to those albums, you're out of luck. Creating additional albums in this manner only provides a "link" that enables the OS to determine that, in addition to the camera roll, a particular photo is viewable in another "album." Thus, if you delete it in the Camera Roll it will be deleted in other albums.
If you want to create albums that contain duplicate copies of photos in the Camera Roll in other "albums," there are lots of apps that do that (though I know of no free versions.) But once again, those photos are copies of what exists in the Camera Roll and can be viewed and managed only through the third party application you use to create those albums.
Finally, if you wish to create photos that are in the albums you create and are NOT present in the Camera Roll, you'll have to do that manipulation on your computer (by moving photos from one folder (including the camera roll) to another.) If you do that, the separate albums will be viewable through the standard iPad apps but you cannot accomplish this task on the iPad, alone.
Want to manage photos without such PITA's? Get a computer.
