Because I've visited many pages at developer.apple.com and
developer.gnome.org, my history is filled with URLs from both sites.
When I start typing "deve..." in location field, all of the addresses
shown in the drop-down are from developer.apple.com; until I type the 'g'
in "gnome", then I can see the developer.gnome.org URLs. It would be nice
if the drop-down would show some URLs from both sites until I've typed
the letter that indicates which one I'm interested in. Then, when there
are multiple URLs with different paths on the same site, fold those like
the sites were folded.

Put another way, don't show:
[d.        ]     <- that's the location field with "d." typed.
 d.a.c/1/1
 d.a.c/1/2
 d.a.c/1/3       <- here's the drop-down list.
 d.a.c/1/4
 d.a.c/1/5

Show:
[d.        ]
 d.a.c/1/1
 d.a.c/2/1
 d.a.c/3/1
 d.g.o/0/0
 d.g.o/1/0

Then:
[d.g       ]
 d.g.o/0/0
 d.g.o/1/0
 d.g.o/2/0
 d.g.o/3/0
 d.g.o/4/0

Then:
[d.g.o/4/  ]
 d.g.o/4/0
 d.g.o/4/1

It might be good to "chop" URLs so that each segment is part of the
history; those segements being what are separated by slashes.

I guess another thing that would help would be a drag handle on
the drop-down list, and remembering the size the user last gave it.
(That's a 'preference' for drop-down list length that doesn't need a
 special spot in the preference panel - like all good preferences. ;-)