PLEASE DISREGARD REQUEST FOR ASSISTANCE: I finally found the answer in Microsoft's Knowledge Base after dozens of searches (can't remember the exact combination of words/terms that finally worked). If anyone else encounters this problem, go to Microsoft KB Article Q321186 "Search Companion Starts If You Double-Click a Folder", and follow the instructions. Although the article appears to address a slightly different problem, it's actually part of, or a variation on, the SAME ISSUE, and the Registry edit repairs both.
This is the URL to Microsoft Knowledge Base Article Q321186:
NOTE: The problem develops after clicking the Advanced button on the File Types tab in Folder Options while "Folder" or "File Folder" is highlighted (Windows Explorer, Tools, Folder Options, File Types tab, click Advanced button while either "Folder" or "File Folder" is highlighted). Simply clicking the Advanced button is the only action required; the problem develops even if you don't edit or make any changes in the file associations. The Registry edit returns a Value to "none", and for whatever reason, it resolves the issue. Detailed step by step instructions for the Registry edit are provided in the KB Article.
If the other stuff doesn't work the above is a MS Article take a look.
I got this of another forum http://www.windowsbbs.com/showthread.php?t=10487