Folders open in new windows when set to use same window

regsvr32 "%SystemRoot%\System32\actxprxy.dll"
regsvr32 "%ProgramFiles%\Internet Explorer\ieproxy.dll"

If folders are opening in new windows on your Windows 7 machine even though settings from Folder Options is set to use same window then follow following steps:

  1. Open command prompt in administrator mode
  2. Run above listed 2 commands
  3. Reboot the machine

You problem will be solved!