I believe that for (1), the tabs overlap so that they take the same amount of space as the old tabs. It's an illusion that they're larger (which I initially fell for also, until I was corrected).

(2) is the same as Chrome and older Firefox versions - to ensure that there is still some draggable area in the window when it is filled with tabs, and it disappears when the window is maximised.

You're right about (1), I took a before/after screenshot (top: FF28; bottom: FF29): http://i.imgur.com/AJlgeBZ.png

Please note that I normally use tree style tabs (https://addons.mozilla.org/en-US/firefox/addon/tree-style-ta...) to put the tabs in a sidebar. It may have messed up the layout a bit. (also, the non-standard colour comes from ColourfulTabs)

I noticed that you used to use the URL bar on top layout as I did. Sadly that is gone now but the Classic Theme add-on will give you the option back.

To me it's just more visually intuitive to have the tab right above the content window, not over all the toolbars. I really can't fathom why the reverse has become the default.

Actually I put them my tabs on the left (default option with tree style tab), as I feel that putting them at the top or bottom of the browser waste space. I put the tabs under the location bar out of convenience, my purpose was to look at the difference in the tab size.

In terms of intuitiveness, it actually makes sense to have the tab bar over the address bar and navigation buttons, as their content and functionality are specific to that tab, and not application-specific. That's the reasoning anyway.

Absolutely right on same space but illusion of more. It's amazing how much small tweaks can make a difference in perception of visual space and faster action: bigger targets, whether actually bigger or seemingly bigger, make users faster in hitting them.

They have removed the option to 'use small icons' which used to shave off some pixels from the crucial vertical real-estate.

That's the first regret when I upgrade.

the tabs that arent in the foreground (ie all other tabs except the front tab) are actually square. im pretty sure the overall layout of tabs and buttons is actually more space efficient