When Only in Current Level is set in the World Outliner, any new folder will be hidden by default since there are no assets from the level in the new folder. This make it seem that the folder wasn't actually created.
Regression:
No - same behavior occurs in 4.16.3 (CL 3561208)
Result:
The new folder immediately hides itself after creation
Expected:
New folder remains visible to allow for organization
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