Originally Posted by gerbil

desktop.htt pretty much controls the size and position of your desktop and the wallpaper you have on it, plus it includes a little activeX control to allow you to reshape it..... IE7 is a little bit incompatible with the old profile you may have had already.
Since this file is automatically generated by windows, the best fix is to delete the old one[s] and let windows create a new one. To do this open an explorer window and go to tools > folder options > view, and uncheck hide protected opsys files. Apply and ok. Then do a search in your sys drive [usually c: ] for desktop.htt. It will be in Docs and Settings\User\Application Data\Microsoft\Internet Explorer.
Delete them [it, whatever...]. Close the explorer window, rclick your desktop and click Refresh, and then go back and RECHECK that box. you really don't want those special files exposed all the time!!