Does it do the same thing with .COM files? Create a new .TXT file on your desktop and rename it test.com and create another and rename it test.exe. If both are showing the default windows icon for files with no association, you are having the same problem I had with IconPackager about a month ago. The only way that I could fix it was to restore my c:\ partition. Something has been written in your registry telling windows to display that icon. I could never figure out what it was and I even tried the messageboard of at MS to get an answer.

Maybe someone else has found the solution or knows what to correct in the registry to fix this problem now.