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Like with other client technologies, it should be possible to animate child items while they are expanded collapsed. For an example, see here: http://dojotoolkit.org/widgets
The Tree in this demo can be found in "Sliding TabContainer" on the left. I'm all for adding more animations, but for TREE this is going to be very difficult, mostly due to its virtual rending. Some compromise would be feasible, for example where the new items appearance/disappearance is animated, but not the shifting of the other rows.
Animated shifting *might* be possible in an somewhat efficient manner by cloning the DOM of the area thats about to be moved (using either cloneNode or innerHTML) and overlay and animate the result.