Growing pains of a new OS, I'm afraid :/ There's an emphasis in Windows 7 on interconnectedness with other electronic devices. I'm guessing photos have been integrated with WMP to encourage users to create playlists of music, pictures, and video, and stream them to other PCs, game systems, TVs, and mobile - hence the playlist/"Play To" functionality in WMP12. In order to streamline this feature, WMP12 shares Libraries with Explorer rather than indexing them itself - as you have discovered.
Like you, I'm not super jazzed about photos in WMP... but I hope this gives you some context for the feature's existence. Also, if you really can't stand it, WMP11 can be restored in Windows 7 like this:
How to Downgrade Windows Media Player 12 to WMP 11 on Windows 7
Cheers,
Walker
Windows Outreach Team