Hi Tim,
How is your iPod connected to your car's stereo? AUX cable? (i.e. the 3.5mm jack behind the center console armrest - a factory option); or did you have a CD changer replaced with the BMW iPod integration cable (i.e. you can control your iPod via your steering wheel controls and the album/artist information is visible on your vehicle's iDrive screen)?
In sum, which "menu" are your albums not showing up on - the car's iDrive menu, or the iPod's screen?
Off the top of my head, this sounds like a problem related to how the songs are stored on your iPod itself. You may need to do some rearranging on your iPod (save the audio files differently; purchase songs directly from iTunes, etc. etc.). Re-sync your iPod Nano with your iTunes and do a little fine-tuning with your playlists.
I have an iPod Classic in place of where the vehicle's CD changer was previously located in the glove box (my local dealership added the hardware). All of the playlists, songs, artists, and albums are easily accessible and visible on the car's iDrive screen. I never used the CD changer, and love the iPod access.
Hope this helps.
Best,