This setting applies only if a default view has not been explicitly set for a folder. You can set an explicit default view for a folder on the "Menu" page in a folder's settings notebook. In addition, special folder classes might override the standard WPS folder behavior so that this setting won't apply either.
This is the standard WPS behavior. For example, if you open
C:\folder\subfolder
and subfolder
doesn't have
an explicit default view set, the WPS will look if folder
has
a default view set, and so on, until the root of the drive is reached. Only
if the WPS still hasn't found a default view then, the setting from the
third "Window" page in the "Workplace Shell" (or "System") object applies.