"Separate Account" Requirement in Roth 401K

[LeeinBoston]

Our law firm started a Roth 401K last year. For various reasons, the full contributions for partners were lump-summed into the 401K in early January of this year. I (and some other employees) use the Schwab "Personal Choice" option that lets us have self-directed brokerage accounts. I assumed that the Roth contribution would be segregated from pre-existing traditional 401K funds, but this is not the case - the funds are commingled. Upon inquiry, our 401K admin told us that this was the proper way to do it, and that they would "track" the Roth 401K money at the back end. This seems very awkward to me (interest on interest, transfers, dividends, and so forth), but they insist this is the correct method. I found the IRS regs on Roth 401Ks, and they refer to both a "separate account" and a "separate accounting requirement" -

"A designated Roth account is a separate account under a section 401(k) plan or section 403(b) plan to which designated Roth contributions are made, and for which separate accounting of contributions, gains, and losses is maintained. This separate accounting requirement applies at the time the designated Roth contribution is contributed to the plan and must continue to apply until the designated Roth account is completely distributed."

Any advice on this issue would be welcome.