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Many years ago I considered ditching picasa for iPhoto but stuck with it as I didn't want my pics being physically rearranged on the disk (Picasa is rightly okay with your pictures being where you want to store them)

Is there a way to prevent iPhoto from doing this?

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Go to iPhoto → Preferences → Advanced and uncheck Copy items to the iPhoto Library.

Note that iPhoto will still copy files to its library if you import photos from an SD card, etc. Instead, copy them where you want first then import them.

Also, changing this setting on an existing library will not relocate media that has already been imported. You can create a new library by holding ⌥ whilst opening iPhoto.

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