Menus have changed in Version 2. We still have the left sidebar menus driven by a parent-child relationship. The horizontal navigation is now located under Site options and when you add a page to the menu that has children those children will be added automatically. We still limit the number of levels that show up on the horizontal navigation. We only show 2 levels.
Another change is that all the items in the horizontal menu are links. In our old system the first served as a label and didn't link anywhere.
Here is a video providing an Overview of the Menus in Version 2.