I find the same issue with UE5 and UE4. I’m not sure if you can change it somewhere in the Editor settings.
Space is totally wasted between the columns of thumbnails.
Changing the thumbnail size doesn’t change this space ratio.
Resizing the content browser window also keeps the space ratio. The item’s thumbnails just jump from one size to the next one without changing the space ratio.
Considering the frame size of a thumbnail, vertical space ratio is actually pretty solid. However, the frame itself could also use a little improvement in terms of space.
I find this behaviour very weird and it just keeps wasting a lot of screen real estate.
Here are examples for what I mean exactly (I’m only resizing the window horizontally):
