Try re-registering your dlls perhaps? From a command console try regsvr32 /i shell32.dll and then attempt an unhide again?

wh666's explanation seems the most likely cause if you're still seeing this kind of funkiness after a reboot. What kind of A/V and malware scanners do you typically run against the box? Something like booting into safe mode and letting a scan of spybot and malwarebytes run through couldn't hurt if you haven't done so already.