I've seen a lot of discussion about this going back for years, with a lot of confusion among the "answers", including blaming the end-user for not understanding the Finder. Lion STILL has a a Finder "quirk" regarding "New Folder" when viewed "as List." Here's how to see it:
1. Launch the Finder.
2. Put the Finder into "List View" (View-->as List, or Command-2)
3. Navigate to some nested sub-folder and click on that folder such that it is highlighted in blue.
4. Select "File-->New Folder" (or Shift-Command-N):
5. Notice that the new, "untitled folder" is created at the root level, not as a child of the selected sub-folder.
At best, this is bad user-interface design, as the action does not operate on the thing that is selected in the user interface. At worst, this is a bug, and a long-standing one at that. At the minimum, the behavior is inconsistent with that of the Column View, which always places the newly created folder inside the currently selected one.
Can anyone comment on why Finder operates this way in List View? I contend that at step 4, above, the most obvious interpretation of the user's action is to place the new folder in the selected sub-folder.
Yes, you can name the "untitled folder" as desired and then drag it into previously selected sub-folder. But in a lengthy list of items, this can be unwieldy. Yes, you can just use the Column View.
Is this behavior too "baked in" to Finder's history to correct? Do "too many" existing users actually prefer this behavior in List View?
I'm not really looking for a "correct answer" here, although I'll award points for the most authoritative response as to what Apple's intention is with the software's behavior.