I recently made the mistake of upgrading to Final Cut Pro X 10.1. I say mistake because after doing so, I was unable to use the program. The program would "hang" indefinitely. Just clicking on an event within a Library would yield the beach ball of death, let alone trying to work in the timeline. Nothing worked!
In my case, the new "Libraries" it created, by combining the Events and Projects into one, were very large. I do not know if this was the source of all my problems, but so far breaking everything up into separate Libraries has at least allowed me to work on projects!
The following video shows how to create separate libraries for each project, one by one. I hope this helps those of you, who, like me, have been burning up the Google search servers seeking a solution! I hope Apple come up with a fix fast, as I do not think this is how they intended for users to manage their media and projects!