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I'd like both options, but if I was to prefer one, I would choose collapsed. It allows some transparency with regards to what is being moderated.

If collapsed posts could be moved to the bottom of the page, that would be good too.

I sort of like them in-line in the conversation - since it lets you know where it occurred in the conversation.

Perhaps they need to be even more compact and take up less room.

I'd agree that inline retains the context, which is important to consider.