Did you change your display density to Compact?
Google has always been weird about the UI of Gmail. I know of no other mail service that doesn't allow creation of folders for sorting mail. So weird. I know you're supposed to apply labels and just archive anything you want out of your regular Inbox, but that seems like a kludge meant to solve something that was never a problem in the first place.
Well, I'm pretty jaded about Gmail's usability quirks these days. No matter how bad the UI gets, it's still more responsive than Hotmail / Live / 365 mail. Besides, since Google's spam filtering is more effective than that of any other service I've tried, I'm pretty tolerant of UI changes. In any case, I'm more apt to check my email using the Gmail app on my phone than via the web.
If it bothers you to the point that you're shopping for another service, you could always enable IMAP and use Outlook or Thunderbird. Maybe?