So you're saying real-world folders switch around the positions of their contents when you open them? :-)

That would be confusing! Not at all. I'm simply saying your take is a lot like a popover and think that Apple's implementation though not perfect, is closer to a folder. Actually, to be exact they should have really called it "Drawers" because that's how their animated and in a drawer, contents do indeed get shuffled around!

Although, I've had instances when handling bulky folders and moving them around, the top most documents would get accidentally rearranged! ;-)

I agree, drawers would have been an apt metaphor. Also, drawers get stuck sometimes, so that would be something interesting Apple could emulate, as well :-)