After some experimenting I have a slightly different understanding of "next action" and the effect of being a project or folder, that I'd like to document. This is a continuation of a discussion started by John Smith here (https://groups.google.com/d/msg/mylifeorganized/CBwYvB_fAOc/p9xUdsxiM-wJ) which I have moved to its own thread in order to get a more meaningful title.
The next action for a branch of your outline is the first active task in the branch. "First" in this case is based on the order of the tasks when viewed fully expanded in an MLO hierarchical view. Consider this tree:
Parent
|- Child 1
| |-Grandchild 1
| |-Grandchild 2
|-Child 2
In this tree, Grandchild 1 is higher than Child 2.
A next action is defined if possible for each branch, defined as an item (task, project or folder) which is found at the highest (root) level together with the entire hierarchy below it.
An additional next action is defined for any project unless the next action for the branch containing the project is already found within the project.
A branch containing no active items has no next action.
One of the seven conditions that make an item inactive is if there are any uncompleted tasks in the hierarchy below it. Therefore, an item at the root that has any uncompleted descendants cannot be its own next action even if none of the uncompleted descendants is active.
Another condition that makes an item inactive is if the item is a folder. A folder at the root that has any active descendants will have a next action, but a folder cannot itself be a next action.
An item can be a project and a folder at the same time. A folder-project like any project will have a next action defined if it has any active descendants. When a project has all of its descendants completed then the project itself becomes the next action *EXCEPT* where it's a folder-project. A folder-project cannot be active and therefore cannot be the next action.
The idea that a project title becomes its own next action at the end of the project is meaningful and useful to some users while being uncomfortable and strange to others. Users who don't like it should make their projects into folder-projects and the issue will go away.