I wanted to reaffirm this post. I have the same complaint. Its very time comsuming to search and change material type when a search does not result in a complete expanded list to choose from. :-\
When searching the scene tree it keeps the enclosing groups in the list, which hinders the ability to easily select all the parts easily. If the parts I am searching for are inside groups, I can't just select all, I have to CTRL+Click on each one I want. Bit of a pain. Would be great if the search would display only the objects that include the search terms.
Yep. This has been requested before (by myself:) and would be a great thing to get changed. I don't ever us the search now, just because of this. Its fairly useless if you are trying to manage large number of parts. Searching for singles is fine, but yeah, if it doesn't match the search, don't show me. There could easily be a tickbox "Show Heirarchy" that would switch between the two modes.