>> I suggest avoiding the word "incoming" for this option, since that implies it is only for inbox-like folders, which is misleading
Um, "Eengrish is not mah native lenguage", but what you called "misleading" is exactly what's going on here.
"As incoming" means "not as archive, not as spam, not as sent, not as deleted, not as drafts" -- as a "regular" plain good old "incoming-type" folder, something that "doesn't have a special meaning".
I'm still open to further discussion on this, but just wanted to clarify.