It was my initial expectation so I think I’d like it to work that way.
If the folder heirarchy is just supposed to be a visual organization tool then it makes sense with no interaction, but it also seems less useful.
On the other hand, if the folder heirarchy actually has implications on views it could take away from the super flexible nature of Infinity.
Maybe other users have a use case for having a completely different parent folder item list than children.
Definitely something to think about and gather ideas from other users on.
Maybe there could be a way for us to swap back and forth between the functionality so we could test? Then you could keep track of who uses the functionality and who keeps it off.
Something like a “show children folder items in parent folder” checkbox.