Right-click within the Projects window in NetBeans IDE 7.2 and from the "View Java Packages As" menu, you can now choose "Reduced Tree".
I never really understood the difference between "Reduced Tree" and the already existing "Tree". But it makes sense when you see it. Here's Reduced Tree view:
And here's Tree view. Tree view is just a plain folder tree, like you would see in the Files window; it scales well and has a clear UI, but you have to expand a lot of nodes in a typical project to find anything.
What's cool is that your selected package view is persisted across restarts of the IDE.
To be complete, here's the List view. List view is a flat list of all packages with no nesting displayed. It can make it quicker to jump to a particular package, though as you can see it can take up a lot of horizontal space. List view can also become overwhelmingly long - and slow to compute - in a very large project.
Seems to me like the new Reduced Tree view combines the best of the Tree view with the best of the List view!
Related issue: http://netbeans.org/bugzilla/show_bug.cgi?id=53192