Alternative to FolderBrowserDialog
For this very reason I developed BetterFolderBrowser. It's a .NET library does just what you need by providing an easy-to-use folder browsing experience that mimics the OpenFileDialog
dialog window. Also, since it works as a component, you'll be able to easily tweak its properties in Design Mode. Hope it helps.
Here you have and OpenFileOrFolder dialog and here another FolderBrowserDialog both Open Source.