Explorer not displaying much, then refusing to re-start

These issues started about a week ago, and a reboot temporarily solves it (which isn't convenient for me).

When I open Windows Explorer, everything shows fine. Then when I open it again a short while later, the main part of the windows is empty and the side bar only shows the Favorites, Libraries and (I think it's) Network (though it may be Homegroup, can't remember), and I can't expand any of those three to show their contents (so basically I can't browse my drives, my documents, anything). If I kill explorer.exe with task manager and then re-start the process, when I click on the Windows Explorer icon on my taskbar or any explorer link in the start menu, it'll pop up with a box about remote process call failed.

The odd think is (or, at least, I think it's odd) is that I can still access stuff, such as opening the Save As dialogue in MS Word, or a program such as iTunes or uTorrent, I can open an explorer window (iTunes showed album contents folder but didn't want to load the side bar fully, uTorrent-instigated folder openings display a bit more).

With peripherals, the latest firmware update to my Android HTC device featured HTC changing the identity from mass storage like a flash drive to an MTP device (meaning I can access files simultaneously on the phone and PC), which often seems to annoy explorer as it doesn't appear to allow me to do two file operations at once. Also, I resurrected my Windows Phone 7 handset, which when trying to sync with Zune it gets to a certain percentage syncing and just stops, even if I unplug the phone it still says, say, 13% sync progress, and restarting phone, Zune, and re-plugging it back in do little to help. I'm just mentioning these two things because I have a feeling they may be related to Explorer consistently giving up.

At the moment, if I hit Control Panel on the Start Menu, the windows opens, but no control panel items/categories display... I'll just attach an image below to show what I'm seeing, it's clearer than trying to explain it.

Sorry I can't really explain it very well, but it's a really frustrating issue that isn't quite killing the computer, but it's making it nearly unusable and incredibly unreliable.

For the record, disk defrangmenter says that C: is 17% fragmented and Soluto gives a similar figure. Could this be the cause, or just one of the many going wrong?

Hi,
(sorry for taking ages to reply, I didn't notice the responses in my subscriptions list)

I tried defragmenting C: last week, which seemed to take two days and then it still said it was fragmented - apparently it can't be successful if there's very little HDD space available (which is the case). Hopefully I'll be buying a large capacity HDD so I can offload some stuff onto it and give defragmenting another go. Because my startup time is so poor I have been disabling a lot of stuff that Soluto recommends I should. I'll check the services next time Explorer goes wrong and keep an eye out for things not running (I'm far from being a PC novice, but I've never used Windows tools such as services, other than to re-start the audio service when it intermittently goes wrong).

Thanks for the SSD tip, I plan on buying one soon and I wasn't aware that it was a bad idea to defragment them.

(In response to roboticarm, I ran a full MSE scan and it came up with nothing. System Restore isn't an option because for some reason I don't have any restore points :/ (curious since I don't recall disabling it and I've been running this install for over half a year). Haven't tried sfc/ scannow yet; the PC Doctor disc that came with the PC (only thing I could find at short notice when the HDD sounded like it was dying) said the main drive was fine, and the pre-boot Windows filesystem checker said C was fine as well, although I really don't like the hollow clicking that's coming from the HDD recently)