So, this time I just, instead of clicking and using the Remove button, I dragged the folder I no longer wanted to search and dropped it to the Trash. In this case, it was my user's Library folder. To my surprise, I didn't see usual "puff." To my horror, my entire Library folder was now in my Trash!! I managed to do Command-Z quickly, but still haven't logged out/in, and now my Safari doesn't make new tab on Command-T.
[robg adds: I tested this on a duplicated folder, and it's definitely a problem -- you're not really in trouble until you empty the trash, of course, but if you don't know about this behavior... This is a very bad design choice, in my opinion. I don't think an action in a Find dialog box should affect the 'real' instance of the folder. This is particularly true given Apple's use of the trash can in other aspects where it is "non-lethal" (dragging a disk image to the trash ejects it, but doesn't erase it from your hard drive). The moral of the story is: Use the Remove button in the Find dialog, at least until or unless Apple changes this behavior.]

