Generally speaking, having a flatter URL structure is typically a better play for SEO.

To better understand why your network admin may have an issue.. can you provide a few examples of "old url" and "new url"..  You can use anonymous fillers, but I'm just looking to get a better understanding of what you have done.

Cheers,

Jake

Thanks Ipegiro...  My point exactly on saying "unless they are creating value within the url"...  as obviously "bunny-on-stool" has a completely different meaning than "bunny-stool"..

Cheers

-Jake

Consider this:  "The location of a Sitemap file determines the set of URLs that can be included in that Sitemap. A Sitemap file located at http://example.com/catalog/sitemap.xml can include any URLs starting with http://example.com/catalog/ but can not include URLs starting with http://example.com/images/." here: http://www.sitemaps.org/protocol.html#location

B would not be an acceptable approach as http://example.com/sitemap/chocolatecakes.xml could only contain a sitemap of content located in http://example.com/sitemap.   For this same reason, you couldn't create sitemaps in subfolder directories...

This is the best approach from those options you mentioned...

(a) http://example.com/sitemap.xml 
http://example.com/sitemap-chocolatecakes.xml 
http://example.com/sitemap-spongecakes.xml
http://example.com/sitemap-chocolatecakes-cherryicing.xml

It is worth noting that you can have a sitemap of sitemaps.. so for example.

http://example.com/sitemap.xml could contain links to http://example.com/sitemap-cakes,  http://example.com/sitemap-articles, etc..
http://example.com/sitemap-cakes.xml could contain links to http://example.com/sitemap-chocolatecakes.xml, http://example.com/sitemap-vanilla-cakes.xml, etc..

Try not to over-complicate things by trying to create sub-category sitemaps, etc.. Unless you have an exorbitant amount of sub-category pages, or have directories/sections managed by different cms, etc.

You generally see large sites will have a separate sitemap based on content type (company pages, category pages, product pages, blog pages)