Finder has been largely redesigned for the 2.x branch, which is supported as of Drupal 7. The primary motivations for this were to improve the cumbersome administrative interface, and remove the redundancy of Finder node and Finder user with the much more useful Finder views. However, once the redesign started, it just would not stop, and a LOT of things wound up getting changed to fit the new paradigms created by the redesign— and more changes are likely to follow.
Chaos tool suite
Finders are now based on CTools exportables. This means that, like Views, finders can be created by administrators, or provided in code by other modules. It also means that anything that integrates with CTools exportables is likely to also integrate with Finder, such as the Features module.
The new administrative interface is provided by the Finder UI module which is based on the CTools export UI. It has been designed with a similar look and feel to the Views UI.
For these reasons, CTools is a required module for Finder 2.
Views; the death of Finder node and Finder user
Finder's find operations (executions of finders) are now built purely around the Views module. This is the functionality that previously lived in Finder views. Finder was originally built with a custom query builder, and this was implemented in the two default base handler modules Finder node and Finder user. Once Finder views was added, it became clear that it was far more powerful than the other base handlers, and effectively rendered them obsolete. Instead of maintaining three different ways to execute a Finder, all efforts will now go towards perfecting the Views integration. The flexibility Finder had in being able to integrate with custom base handler modules is now replaced with the flexibility that Views offers; it is much smarter for module developers to focus integration efforts for Views and have them automatically work in Finder, than to do integration for both modules.
Views is a required dependency of Finder 2.
Finder search
The core search.module integration is now built directly into Finder. In order to function correctly as a separate module, Finder search did some really awkward things to the Drupal core theme system. By adding it straight into Finder, the code is less than a third of the size it was previously, and doesn't have to be overly tricky to achieve its goal.
Another reason for removing this module was that its name led to a lot of confusion; Finder is perceived as a 'search module' itself, and many people probably turned this functionality on and posted issues about it, without realizing that it was functionality that they didn't need.
Finder string translations (i18nstrings)
This module is also removed, and the functionality has been built into the Finder UI module.
Finder autocomplete, Finder option widgets, and Finder text
These modules were the element handlers in Finder 1.x, and they have now been converted to use the CTools plugins system. With the ability to do code-based 'default finders' because of CTools exportables, it makes more sense to provide these as plugins, rather than separate modules. It also makes the installation process simpler for new users, as at the time of installation one may not yet realize what these modules are for, and fail to enable them, causing the default finders to crash.
There is documentation for module developers on how to create these plugins.
Redesign of Finder functionality, API, hooks, and themes
Finder has been converted to be class-based and mostly object-oriented. This opens up the door for many improvements to take advantage of the design.
Additionally the workflow of Finder has been greatly simplified, due to the Views-only approach for generating queries.
This has caused massive changes to the Finder API, hooks, and themes. If you have previously written code to add features, override themes, or manipulate Finders, you won't like this much. If you're upgrading to Finder 2.x, forget all that stuff you wrote! I did… If that's too much for you to handle right now, you should continue running Finder 1.x for existing installations until you can find the time to create new themes, or learn the new API.
Upgrading
Users upgrading from previous versions are advised to first install the latest 1.x version of Finder, before continuing on with installing the 2.x. It is very important to back up your database and code first — just in case the upgrade script doesn't like your finders and fails to port them over. Reasonable steps have been taken to retain previously configured Finders, but since so much has changed, it is possible you will be unhappy with the behavior of the finders until you review and configure the new settings.