Compare to before enabling folder sharing:
So in this case, you will not able to add individual users to receive email for the report. Even, the report folder is accessible by All Internal Users.
Salesforce aware of this issue, it is captured as know issue with plan to fix on Summer '14 release.
Add individual users need to receive email of schedule report to the report Folder Sharing, see this screenshot:
This issue and workaround is exactly the same for Schedule Dashboard Refresh, add user into Dashboard Folder share.
Reference: No available Groups, Roles or Users to select when scheduling a Report