I'm having exaclty the same problem!
If you right-click on the drive a select 'open' you can get to the drive - but double-clicking
brings up the 'Open With' window.
The svchost.exe is a system file - but only the one in the system32 folder - the
file Saqib deleted was in c:\windows so was probably part of the trojan (I had one
in c:\windows\system\)
Anyone have any idea how to fix this??
Cheers