Error display on application icons on XP desktop

You say Vista Home in your profile, but XP in the question title. Which OS is this on (name, version, and bit-size, and SP number) and when did this start? Have you made any changes to the system since just before the problem began (new installations, uninstallations, updates, new hardware, anything)?

Thanks!
 

My Computer

System One

  • Manufacturer/Model
    Dell Inc. MP061 Inspiron E1705
    CPU
    2.00 gigahertz Intel Core 2 Duo 64 kilobyte primary memory
    Motherboard
    Board: Dell Inc. 0YD479 Bus Clock: 166 megahertz
    Memory
    2046 Megabytes Usable Installed Memory
    Graphics Card(s)
    ATI Mobility Radeon X1400 (Microsoft Corporation - WDDM) [Di
    Sound Card
    SigmaTel High Definition Audio CODEC
    Monitor(s) Displays
    Generic PnP Monitor (17.2"vis)
    Screen Resolution
    1920 x 1200 pixels
    Hard Drives
    Hitachi HTS541616J9SA00 [Hard drive] (160.04 GB) -- drive 0, s/n SB2411SJGLLRMB, rev SB4OC74P, SMART Status: Healthy
    Case
    Chassis Serial Number: 5YK95C1
    Keyboard
    Standard PS/2 Keyboard
    Mouse
    Logitech HID-compliant Cordless Mouse
    Internet Speed
    1958 Kbps download ; 754.8 Kbps upload
    Other Info
    Optiarc DVD+-RW AD-5540A ATA Device [CD-ROM drive]

    Dell AIO Printer A940

    Conexant HDA D110 MDC V.92 Modem

    6TO4 Adapter
    Broadcom 440x 10/100 Integrated Controller
    Broadcom 802.11n Network Adapter
    Microsoft ISATAP Adapter
    Teredo Tunneling Pseudo-Interface

    Router Linksys / WRT54G -01
Apologies that I have sent this request through my initial profile of my laptop configurations. This error is occurring on my desktop computer and I cannot remember which installation I had made recently and when. The error was discovered about two months ago and left it since it wasn't interfering with my operations but the display never disappeared.
 

My Computer

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