Win Explorer Can't render Thumbnails, or icons correctly

[zapp22]

Friends
I have a Vista Home Premium setup that was badly infected by all sorts of malicious gremlins. it is all clear now and the registry is ok, but still has some errors as best I can determine from several different scans. But the Vista repair routines builtin to the recovery processes show no damage; nothing to repair.

So, every desktop presentation format works correctly except for one thing: none of them can apply a bitmap or image to the background. the process simply fails. no error codes or other anomalies, it just fails. Everything else, in Aero, for instance, works and looks and acts correctly. Same with Vista Basic, Windows Classic and so forth. Adding a third party theme works, except for the wallpaper/background. plain color background applique's do work.

So, in trying to solve, I also notice that in Windows Explorer, browing folders, even folders that are assumed to contain images ["My Pictures" for example], the default view setting does not work. What it renders is a whitespace where a "large icon" should be, with the filename shown below, as it should if there were an image thumbnail present. in Vista, there is no explicit selection in Folder/Options/Views for "thumbnails", so its supposed to figure out whether there is an image file, and if there is, render a thumbnail. it doesn't.
However, click on a filename for an image, and stuff works ok.

I have taken the Microsoft-suggested steps for such a bug, to no avail [surprise].

Anyone have a suggestion on this one?