It was actually a great feature (memory may be failing at this point), and it seemed like the filesystem viewer was IE presenting a filesystem view. If you typed an http or https URL, the window would turn into an HTML renderer window. This made it possible to build their mail and newsgroup reader apps as filesystem views. Mail was nothing but a folder full of email message files. News was, surprise, a folder full of newsgroups. Those viewers were responsible with synchronizing the folder with remote services.
I would love if Gnome would allow pluggable views in Files: a mail reader for maildir folders, a music player for folders full of audio files, and so on.