I am unaware of any 'bugs' with any Microsoft Operating System related to the 'My Pictures' folder.

Join the crew. I've had/have the same problem on 98, 2000, ME and XP. This has been on numerous laptops and desktops. It would appear to me to be not OS or hardware specific. I've taken to just forgetting about "MyPictures" folder; for me I make a photo or pic folder and use it that way. Most of my photo programs allow one to set the default folder, so it's no sweat. For hose that don't, oh well.

I've seen no satisfactory work around posted at Microsoft or anywhere else. So, I've just decided not to be a lemming and follow my own drum ... that darned drum's thumping gives me a headache tho. :-)