Matthias Clasen has pointed out via his blog that the nearly eight-year-old Bug 336238 has finally been addressed. This bug report is about text being rewrapped when resizing the GNOME Terminal window. The bug report back in March of 2006 cited that the Mac OS X Terminal exhibits this feature of automatically re-doing line-wrapping when resizing the screen. Now with the latest GNOME Terminal in the 3.11 series, it's finally possible.
For long lines of text within the GNOME Terminal, when expanding the window's screen the word-wrapping will now automatically update. This is a change that should be found in GNOME 3.12 but there's still some developers evaluating its design, etc. The updated Terminal has already landed in Fedora (21) Rawhide for those interested.
Clasen also noted via his blog, "We are planning to to land a few more improvements to gnome-terminal this cycle. Next in line is may be a gnome-shell search provider."
Coincidentally, this week Enlightenment's Terminal was updated. In the Enlightenment Terminology 0.4 release, there's also support for text re-flow on resizing the terminal.