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There are two ways you can tell Opus to mix files & folders:
[ol][li]Go to Tools -> Folder Options and then the Display tab. Under Sorting Options there is a Mixing drop-down which you can set to:
[ul][li]Files listed before folders[/li]
[li]Folders listed before files (the default)[/li]
[li]Mix files and folders together (what you want)[/li][/ul]
Going in there every time you want to change it will be a pain, though, so here's a more convenient way:
[/li]
[li]You can make a button, menu item or hotkey which runs this command to make the current window mix files & folders:
Set SORTORDER=Mixed
Working from there, you could make a button, menu item or hotkey which you click to sort by modified and mix files & folders:
Set SORTORDER=Mixed SORTBY=modified SORTREVERSE=On
(Use SORTREVERSE=Off if you find that sorts in the opposite way to what you want.)
Now you'll probably also want something to go back to sorting by Name and separating files & folders, which is what this command does:
Set SORTORDER=Folders SORTBY=Name SORTREVERSE=Off
Using a "three-button" is a convenient way to combine the two commands on a single button. Three-buttons can have up to three different actions, one for the left, right and middle mouse buttons. This one will only have two actions:
[ul][li]Left-click: Sort by modified and mix files & folders[/li]
[li]Right-click: Sort by name and separate files & folders[/li][/ul]
In the box below you'll find XML code that you can paste straight on to your toolbar to create the three-button. See the guide, How to add buttons from this forum to your toolbars, for instructions on how to do it. (You don't have to edit any files by hand or understand XML.)
Also, if you want to learn more about creating your own toolbar/menu buttons, watch the Toolbars 1 (video tutorial)
Here's the button code for pasting to your toolbar:
<?xml version="1.0"?>
<button backcol="none" display="both" label_pos="right" textcol="none" type="three_button">
<label>Sort Modified</label>
<icon1>#setdate</icon1>
<button backcol="none" display="both" label_pos="right" textcol="none">
<label>Sort Modified</label>
<tip>Sort by Modified, mixing files & folders</tip>
<icon1>#setdate</icon1>
<function type="normal">
<instruction>Set SORTORDER=Mixed SORTBY=modified SORTREVERSE=On</instruction>
</function>
</button>
<button display="both" label_pos="right">
<label>Sort by Name</label>
<icon1>41</icon1>
<function type="normal">
<instruction>Set SORTORDER=Folders SORTBY=Name SORTREVERSE=Off</instruction>
</function>
</button>
</button>
[/li][/ol]
I think it's always been Tools -> Folder Options in Opus. What did you read that said otherwise? I'll get it updated if I can.
The menu item was put there so that people used to going there in Explorer would find it in Opus, though I agree that the Settings menu would be more logical.
By the way, have a read of the Folder Formats FAQ as it will probably save you some time and confusion to understand how it all works up-front.