Dear J. Brueckner,
I understand how disappointed you feel, and you’re not alone.
Microsoft streamlined File Explorer’s Navigation Pane to reduce duplication between Quick Access, Libraries, and user profile folders. As a result, subfolders under Documents don’t automatically expand the way they did in Windows 10. However, you can restore much of the old Windows 10 behavior by enabling “Expand to open folder” and “Show all folders” in the Navigation Pane. This will let you drag files directly into sibling subfolders again.
The new design emphasizes cloud libraries, which sometimes hides the traditional folder tree unless you explicitly expand it.
Good news is that Microsoft has been actively updating File Explorer in Windows 11 24H2 and 25H2 with usability improvements, including better folder expansion and AI‑driven search refinements.
If you find this information useful to some extent, please accept the answer so that your experience with the issue would help contribute to the whole community. Thank you :)
Vivian