Error when deleting, renaming or moving a a folder named '..

Archived from groups: microsoft.public.windowsxp.help_and_support (More info?)

Whenever a folder named 'New Folder' is deleted/moved/renamed from my desktop
this message appears http://home.att.net/~v_spec/just_weird.JPG

That message usually apprears for deleting/moving/renaming system files and
system folders however this message is appearing for a regular new folder
that I created on my desktop.

As long as I delete/rename/move a folder named 'New Folder' on my desktop
that message pops up, regardless if there is anything in the folder or not.
I've been doing some research for the past 3 hours and I think that the
folder 'New Folder' is attributed as a system folder therefore that message
is appearing.

Does anyone else have any idea what's causing this?