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Last edited by iTRiP; 18 Aug 2012 at 06:53.
While there is no cure to determine in all cases how a computer was damaged by a possible infection, there is a prevention mechanism. It is antivirus software. For whatever reasons, if you choose not to use one, you lend yourself to this type of situation. It's obviously very frustrating, so hopefully you can learn from that and implement some proper antivirus software that can help prevent you from getting back into another one of these situations.
Lots of people put lots of extra software on their machines and have no problems. These people are the ones that understand, respect, and implement the security measures necessary to keep their machines healthy. It doesn't take an illegal action on your computer to contract something that will degrade the OS. Sometimes all it takes is being on the wrong site at the wrong time or opening the wrong email. For these situations, antivirus helps prevent the headache that would have ensued once infected, as we've experienced here.
To those who want to say things about users doing in appropriate things/non-legal software/etc., as the cause of this I have one thing to say ... Bull <sneeze>.
Although not Windows 7 per sey, I have a completely legitimate installation of Windows Server 2008 R2, all software installed on this server is legal, anti-virus is up to date, with multiple tools to perform scans on a routine basis since no tool is perfect. This server is used for RDS and multiple users, including admin accounts, are experiencing this issue. This is a bug that has been around for a long time. I have seen many threads on this topic, none of which have been truly resolved, most of which have been closed because of age despite ongoing additions to the the thread. See the following for an example: "Windows Explorer has stopped working" error after right - Microsoft Answers
Age of a thread is no reason to close it. That is as offensive as the slurs against people in this thread, that it is illegitimate usage causing this problem.
This is a long standing bug which Microsoft should have resolved ages ago and no degree of apologetics by Microsoft sycophants can prove otherwise. One more example of bad business and lousy ethics.