I’m not trying to defend the design decisions, just explain the apparent thought process. The “Vault” page has been redesigned to use filtering/searching as a paradigm for finding relevant vault content. When a filter is applied, or a search term entered, the “All Items” section only displays items that match the search/filter criteria. The fewer criteria are specified, the more items are shown in the search results; thus, it seems that for logical consistency, the “All Items” list should indeed contain all vault items when no filters or search terms have been specified.
As of version 2025.1.1, the “All Items” section can be collapsed, and it will then expand automatically whenever a search term or filter has been specified. This is how it should have been implemented from the beginning.
The naming of the “All Items” section is also misleading. It should probably be “Search Results” or “Other Search Results” (since search results do also appear under “Autofill Suggestions” and “Favorites”).
I’ve previously enumerated a number of differences between the old and new UIs for folders. Although objecting against some (or all) of those changes is reasonable, giving a 
reaction to the fact that the number of clicks did not change seems, well, a bit petulant…