Windows 7: Document Library Issue

Hello,
I have been using 7 for a while now, and a few months back I had something goofy happen to my document libraries that I haven't bothered to resolve yet.

I just have 1 folder "included" c:\users\me\Documents.. when I first include the folder, I can see all my folders within My Documents, but a few seconds later all folders go away, and I see every file!!

I have a number of websites I have setup backed up in my documents, so having all these random files is a real pain!

my music and pictures libraries are just fine, and if I manually go to c:\users\me\documents, everything shows up fine..

I searched around a little, but didn't see anyone else with this issue, if this is a common issue, please share the link!!

I attached a screen shot (snipping tool) there are almost 13,000 files in here...

Thanks!!