The first question is what is your newbb version?
You can find your newbb version easily in admin area by putting your mouse over the newbb icon.

For newbb1:
go to system --> preferences --> general setting and change "Default Comment Display Mode" to "flat"

For newbb2:
go to newbb admin --> preferences and change "View Mode of the Threads" to "flat"

For changing the view mode for existing users to flat run this query in your database via phpmyadmin:

if you using another perfix change "xoops" with your xoops_perfix