This also creates another folder in the main html instead of under the subdomain folder. If we do this we will have a folder in the subdomain, multisites and in the main html folders. This was not the case prior to the recent update.

I don't know all your parameters but this is absolutely normal to have a directory in /multisites/{site_id} as this is the place where JMS Multisites save its configuration.

The alias field allow to create a Symbolic Link in the full path that you provide that point to the deploy folder.

So by definition, you have 2 or event 3 directories created.
One in /multisites/{site_id} when JMS Multisites save its own data
One in the deploy folder
One Symbolic Link that ponit to the deploy folder.

So everything is normal.
If you don't want to have a link between alias and deploy folder, don't use the alias and provide correct value in the deploy folder.