Fix Found: Click through the following:
Start, Control Panel, System and Maintenance, Administrative Tools-Free up disk space, Files from all users, (C
OK, Files to delete:CHECK THUMBNAILS OPTION
, click OK.
Everything was back to normal! Clearing the thumbnail cache via this method worked for me.
By the way, this problem just appeared recently. I have been running Vista since it's initial release two years ago and only had a problem develop this week.
Something other than cache size (program update maybe) has caused this issue. Perhaps they can fix this issue in a future update.
I do not relish deleting cache on a regular basis just to perform a go around for a systemic issue.
Before starting make sure you are logged on as an Administrator. Then follow these steps:
1. First, turn off thumbnail creation by opening Windows Explorer, clicking the Organize button and selecting Folder and Search Options.
Click on the View tab and check Always show icons, never thumbnails. Click the OK button.
2.Then, run Disk Cleanup on Drive C: and empty the cache so you can recover the disk space. You can find it in Accessories/System Tools.
3.In Windows Explorer, navigate to the AppData\Local\Microsoft\Windows folder under your name.
If you can't find it, just copy the following: %LocalAppData%\Microsoft\Windows
Paste it into the Address Bar and hit Enter.
4.Right-Click on the Explorer folder and select Properties.
Select the Security tab.
Click the Advanced button.
On the Permissions tab, click the Edit button.
Uncheck Include inheritable permissions from this object's parent.
5.Click the Remove button in the Windows Security box that pops up.
6.Click the OK button on the Permissions Tab.
7.Click the Yes button in the Windows Security box that pops up.
8.Close all the open boxes.
9.Go back into the Folder and Search Options and uncheck the Always show icons, never thumbnails and you're done.
Now, browse any folder you want and Windows will create the thumbnails on the fly, but won't save them to disk.