I worked in a used bookstore for several years, so I also must organize my books. We have about 15 large bookcases, and I can still go to most any book we have with a minimum of fuss.
It's mostly genre, with some exceptions. For example, I keep hardback fiction in one place, paperback fiction another, modern Indian fiction first editions in another, Vintage International paperbacks in another, next to Vintage Departures...
Within genres, it's much more idiosyncratic. Maybe Austen and Bronte together, Sherman Alexie and T.C. Boyle together, Margaret Atwood and Lorrie Moore together. Just authors that remind me of each other, whether there is an actual link or not.
fbaezer (by the way you are very cool lookin'!), your post reminds me that last night my husband and I were discussing doing some redistribution, since right now the sex & erotica books are on a lower shelf, at sozlet level. (We have the Tannahil books too, Jes.) We haven't decided yet if it would actually bother us if she finds them. Hmm.
edit: "modern Indian Indian"
--> "modern Indian fiction"