Replace Folders with 'Recent Folders'

[v-aravind]

Is your feature request related to a problem? Please describe.
Recent Folders not shown anywhere, Recent items only shows files.

Describe the solution you'd like
Replace the Folders section with Recent Folders

Describe alternatives you've considered
Show recent folders in some other location, like sidebar, similar to Windows Explorer? But due to larger item size, this might not be a good idea.

Additional context

[yaira2]

Merging with #2718 & #4074.