OK i WAS ABOUT TO SUGGEST RUN-->cmd THEN TYPE explore BUT YOU SAID HE DID SO. Here are my Question:
What about task bar?

Here is my suggestion:
Try using system restore to restore it to last worked config and then re-scan it using trusted AV

try and Feedback
Steve

go to run and type cmd

in the command prompt type

sfc /scannow

and wait. you may need your vista cd.

Thanks guys The crap part was he didnt have a Vista OS until I gave him one. I just wanted to know If there was a workaround. I got hold of a OS witch is XP (I just had to) to solve the prob. Thanks again.

Cheers

I have the same problem on a Windows XP Pro machine. It occurred after running AVG 7.5 anti-virus. My hard drive does a lot of crunching after rebooting. The desktop displays my background picture, but none of my shortcuts. The only way I can access files is through Task Manager. They seem to run fine from there. The processes running in Task Manager are only about 25, when normally there are about 34. I'm not sure exactly what's missing. The day that the problem started (before running AVG) I was getting some annoying ad launches when I was running my browser, Firefox.

If you need to get to your desktop, you can bring up the Task Manager with Control-Alt-Delete, then choose Task Manager. From Task Manager, pick File-New Task (Run), and then navigate to C: Windows and choose explorer.exe. Running this program will bring your desktop back. I don't think it will fix the problem, but at least you can work on it from familiar territory. This is as far as I've gotten. I am going to paste a shortcut to explorer.exe in my startup folder and see if that works.

I had this happen to me recently. I rebooted into safe mode and that was missing too. So I rebooted into command mode and went to the windows directory and typed explorer and it wouldn't let me in but asked if I wanted to do a restore, I chose yes and for some reason there was only one there, from about 15 minutes ago. But what could I do, that is the one I chose and let it do its thing. It took another couple of reboots to get it working right again but in the end I got it back to normal.

try to repair the operating system .