Folders open in new windows when set to use same window

"I had the same problem. Re-registering two dll's and rebooting solved it:

regsvr32 ""%SystemRoot%\System32\actxprxy.dll""
regsvr32 ""%ProgramFiles%\Internet Explorer\ieproxy.dll""

I discovered the solution here: http://www.davidmoore.info/2009/08/19/solution-explorer-open-each-folder-in-same-window-error-and-sql-management-studio-ie-and-team-explorer-errors/"

"I'm having the same problem on the machine I'm at, but it doesn't happen on other machines I've used in the past. You inspired me to try something just now

In folder options, choose file types. find the ""(NONE) Folder"" item and click on Advanced
set the default action to open (was yours set to explore like mine?). That didn't work, but I did notice it's opening up in new window when the folders pane is visible, and otherwise in its own window - does that match your behaviour?"