Is it possible to add a button to the Lion finder that goes up a directory? I looked at the buttons available under customize and didn't see one, but thought there might be a hack out there.
I found this app that does what I was looking for. Once extracting it to your Applications folder or wherever you want to keep it, drag it to the Finder next to the Back/Forward buttons. It's a little bit smaller than them in Lion, but the styling fits.
Credit to Simon Slangen for creating the app
When you Command-Click on the folder icon on an item in the title bar of a Finder window, you get a contextual menu showing the folder hierarchy to the root of the drive. You can then use the mouse to select a higher level of the hierarchy and move there in the Finder window. It's convenient and appealing because you see the whole hierarchy.
You can make a simple Automator app to do this and put it's icon in the tool bar. It may be slightly slower than an AppleScript app, but the Automator app won't change the focus of the window when it launches (the current Finder window remains the active window the whole time), so it has a more integrated feel.
Still, the quickest way is definitely to use Cmd+Up Arrow.
In Automator, add a "Run Applescript" action and replace the entire default script with this:
tell application "Finder" tell application "System Events" to key code 126 using command down end tell
This script simply sends Cmd+Up Arrow to the Finder.
Save your Automator app, then drag its icon to the Finder's tool bar. You may want to first make a new icon for it to indicate its function.