What is the purpose of this virtualization idiocy and how to disable this cretinous feature?
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File and Registry Virtualization (also known as FARV) was included in Windows Vista to caulk over a long-standing security hole in Windows' architecture. It's part of a more comprehensive aspect of the operating system called User Account Control (UAC).
Before Vista, MSFT' design for Windows allowed (hell, often required) users and the applications they employ to run with super privileges. This made things easier for users and lazy developers but also created a well-paved path for malware.
Exploiting a session's super-user privileges, malware can ride the royal road to critical OS and application components, altering files and settings to suit the virus writer's purposes. Windows' original security model was so poorly implemented, even browsing could compromise your machine. For example, a large number of attacks exist which take advantage of Internet Explorer and ActiveX, a widely used component object model (or software platform) via buffer overflow errors (see: en.wikipedia.org/wiki/Buffer_overflow).
UAC, and its FARV element were included to partially close this 'window of vulnerability' by: 1.) restricting the session privileges users and apps have and 2.) obscuring the true location of files and registry settings (the registry is the operating system's internal database. It stores settings and file location data). The hope is that malware will be hamstrung by these limitations and prevented from doing harm.
This is better than the previous design but still suffers from problems; recently, you've been encountering your share of them.
Several people have helpfully suggested you ditch Vista in favor of WinXP or Ubuntu. I detest Vista (see: <http://monroelab.net/blog/?p=611>) so of course, I second and third these suggestions. But, you've repeatedly said that this is the machine you've been issued (by your university, I'm guessing) so you have to make do.
Your next best option is turning off UAC, the 'feature' which activates FARV.
Here's a link to an easy step-by-step detailing how to do jsut that:
I suspect however, that you may run into resistance from your U's IT administration. No doubt, they consider this to be a necessary security measure. You may have to make a strong and coherent argument in favor of turning it off.
.d.