Problem: You try to use a common Windows Explorer-dependent method. For example, you try to start Explorer.exe or to start Control Panel.

Nothing happens, and after a while an error message pops up stating

Server Execution Failed

Solution: Go to http://support2.microsoft.com/kb/2444677 and find the "MORE INFORMATION"-paragraph.
Go to the second bullet, "In Wicows Explorer..." and follow the steps. Reboot and see if the problem persists.

An ugly temporary workaround is to put the document you're trying to open on the desktop and start it directly from there.