Hi Chuck,
1) The directory defaults to whatever directory points to the BACKGROUND_DUMP_DEST folder on the database. So I'm thinking that these TRCA directories probably point to the same location, and either one should work. Can you check that for me?
2) That "open file from server" window is used for trace files, programs, libraries, scheduler jobs, and BFiles. I've made a change so that it will remember the last used filter (and most 10 most recently used filters) for each of these separately.
3) Several versions ago I made a change such that we kept the file open so we could quickly jump to any part of it while viewing in the Trace File Browser. That caused other problems and it doesn't do that anymore. Can you try this in the beta and let me know if it works better there? It works fine for me in 12.10 with notepad, but maybe whatever editor you are using requires a lock on the file.