I really liked the files-as-directories behaviour. One of the objections I recall from the time was that this sort of behaviour would make more sense at VFS level.
I'd love to have this sort of functionality available (ISTR it has potentially other useful properties - e.g. new properties / metadata attached to files can automagically be handled by things like tar).
My memory says that concerns around overlapping file and directory behaviour caused pushback here. I think being able to hardlink to a directory was the issue (if every file can be a directory then how do you avoid directory cycles) but I may be mangling the details.
