You can show the entire conversation by clicking the arrow by the conversation heading.
When messages are arranged by conversation, you can see the "traffic flow" of a conversation. Messages are indented to show you who replied to whom. The dates show you when they replied.
You may be familiar with the term mail thread. This arrangement lets you keep track of the threads. The conversation in the picture shows a few mail threads in a single conversation. Want the details?
The messages indented under Linda's response are one thread, while Chris's 12:40 PM response is another. The indenting lets you know right away who participated in which thread. For example, everyone else in the conversation added their thoughts to Linda's response, not Chris's (although Chris got back into that thread at 3:41 PM, and again at 5:50 PM).
If you were trying to get caught up on the details of a conversation, you would read the thread under Linda Contreras's first, and then if you were curious, you could see what Chris Ashton had to say at 12:40 PM (but you'd know that his comments in that message weren't the most up to date, and that they didn't take into consideration everyone else's thoughts).