M3U files, at the very, very minimum, are text files listing MP3s in a particular directory. Most of my playlists are located with their MP3s, so they don’t mess with file paths. There is an M3U specification, but I tend to be lazy.
How lazy?
I open up a command prompt in my directory of MP3s and type:
dir /b *.mp3 > "playlist.m3u"
I then edit the resulting M3U file in Notepad, if I need to change anything around. Usually, my files are named in a way to put them in their proper track order.
This technique applies to Windows. Not sure what other operating system users do.