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Some readers seem to be confused
Authored by: Dr. T on Nov 26, '08 10:43:13AM
Here's how to see the problem.
    Open your Documents folder and switch to list view. Highlight a folder that you know will have other folders inside. (We'll call it Folder 1.) Click the triangle to the left of Folder 1: The list of files and folders in Folder 1 will be indented. Select a folder from those in the indented list. (We'll call it Folder 2.) Click the triangle to see a more indented list of files and folders. With Folder 2 still highlighted, type command-shift-N or click on the New Folder button in the toolbar. A new "Untitled" folder is created within the Document folder. This occurs regardless of Finder preferences.
      I beleive some people misunderstood the problem and were double-clicking on folders in list view instead of using the list display triangles.
        The hint I posted earlier gets around the problem by opening the selected folder, creating the new folder there, then switching back to the previous list view. Apple chose the logic of its file system instead of the preferences of the users. Users who have a nested folder highlighted rarely want to make a new folder at the top level, they want it within the selected folder. We should be able to change this behavior within Finder preferences.

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