Can Notepad++ be made to open file links in itself?

file:// is an intrinsic protocol of Windows, so if you want to ignore the "whatever file-association [is] set in Windows," i'd suggest you use a dedicated protocol, say npp://. Then add this to your registry (using the corresponding path on your system):

[HKEY_CLASSES_ROOT\NPP]
@="URL: NotePad++ Protocol"
"URL Protocol"=""

[HKEY_CLASSES_ROOT\NPP\DefaultIcon]
@="\"C:\\Program Files\\Notepad++\\notepad++.exe\""

[HKEY_CLASSES_ROOT\NPP\shell]

[HKEY_CLASSES_ROOT\NPP\shell\open]

[HKEY_CLASSES_ROOT\NPP\shell\open\command]
@="\"C:\\Program Files\\Notepad++\\notepad++.exe\" \"%1\""

The given answer did not work for my Windows 7 Pro system. The parameter %1 was never (correctly) provided to NotePad++ and it started with an empty new file.

However instead I started a batch file through @=c:\soft\start-notepad.bat "%1" In this batch file I stripped off the NPP:/// prefix from %1 and replaced / with \ inside of %1. From this batch file the start of NotePad++ with the modified parameter %1 does work perfectly. Here is the short batch file code:

start-notepad.bat

set note=insert here the path to notepad++.exe
set para1=%1%
SETLOCAL ENABLEDELAYEDEXPANSION 
set para1=!para1:edit:///=!
set para1=!para1:/=\!
%note% %para1%

The quotation marks "%1" around %1 are not really necessary, because paths or filenames with spaces or special symbols will anyhow result in broken hyperlinks in Notepad++.

If necessary this has to be corrected in NotePad++ with e.g. %20 for the "space", otherwise the hyperlinking of link NPP:///c:/path/file name.txt will stop after file.