The attached patch is a proof of concept that changes the output of regrtest so that the "[xxx/yyy] test_zzzzzz" is updated in place instead of printing each test on a separate line.  Failures, skips, and the final report are printed normally, making it easier to find what failed without having to scroll for 400+ lines of output.
The patch works with and without -j, but I haven't tested it with other flags.

If people like the idea, this could be the default behavior, otherwise a new flag to enable the feature could be added (or it could be enabled with the already existing -q/--quiet).

Also attached a sample output of a full test run.