Perhaps a drill down option and/or expand such that the toolbar is always one row, but minimizes top level options when one enters additional pen level detailed options (level 2).

There could be a arrow up to navigate back up to seeing the full level 1 toolbar again.

YES - I need to option to further customize the toolbar so that my writing page is maximized on the screen. I really only want 1 toolbar row like the app used to be.

There is an option to hide the status bar, but I often glance up to see the date, time and battery levels on my iPad.

Perhaps a compact status bar option would still show the date, time & battery...
AND fill the unused space with the open tabs?

Exactly! It just needs to be an option that users can toggle between, perhaps alongside the reader view that’s already present. A more compact toolbar would make it easier, especially on the iPad mini and 11 inch iPads, to see more content on screen, and thus avoid zooming in or using the zoom window as much. I think a floating toolbar design could be cool, and maybe it could just hold tools that the user chooses to favorite. Especially now with the new squeeze gesture on the Apple Pencil pro, the entire toolbar permanently at the top of the app has become a little redundant for Apple Pencil pro users.

The fact that it’s even bigger now in GoodNotes 6 is mind blowing. I paid for GN6 and it’s almost worth switching back to Notability and paying the yearly fee because my documents fill the screen, and they have grouping/aligning features which are desperately needed for Notetaking.

Agreed. I see that this idea has been suggested since 2019. What are we doing GOODNOTES!!!!