Windows 7 Desktop Icons corrupt

This was fixed by reducing screen color depth to 16bit as suggested by Andreas above, and then deleting USERPROFILE%\AppData\Local\IconCache.db. After restoring to 32-bit, the icons reappeared.

Here's how to rebuild the icon cache:

1. Delete the file %USERPROFILE%\AppData\Local\Iconcache.db
2. Start Task Manager (Right click the taskbar, select Start Task Manager )
3. From the Processes tab, select explorer.exe and click the End Process button
4. Explorer (Taskbar, desktop etc) should now go away and come back.

How do I delete the file? In the Start menu, type in del %USERPROFILE%\AppData\Local\Iconcache.db I recommend copy/paste so you don't mistype it.

Why kill it rather than just logging off and on again?
Windows Explorer will load the icon cache into memory when it starts, and then update it in-memory. When it shuts down, for example when you log out, it will write that cache to the file listed above, making it saved as corrupted. By forcibly killing it, you prevent it from writing the (corrupted) cache to disk, and force it to build a new cache when it starts back up. Hopefully that cache will not be corrupted.

we just had the corrupted icon issue on our Win7 system. The problem was that some apps and files had incorrect icons associated with them. We used the method above of adjusting color depth to 16-bit, but instead of manually editing the registry, we just logged-off after changing to 16-bit. That, as noted, forces Windows to save the new settings, overwriting the bad 32-bit iconcache. Log in, change back to 32-bit color, everything is fine.