I think it has something to do with your registry. In particular - the registry that handles file types for images are screwed.
Okay, there are four solutions
FIRST SOLUTION:
If you are using Windows XP, simply go to Windows Explorer, then select an image file, right click it, choose Open With, then Choose Programs. Choose your default image application and check "Always use the selected program to open this kind of file".
Repeat for common image files such as JPEG, JPG, GIF, BMP, PNG, TIF...
TIP: Use Recommended Programs such as Windows Picture and Fax Viewer.
SECOND SOLUTION:
Or if you're using older versions of Windows (works on XP too)
1. Open Windows Explorer, go to Tools, then Folder Options
2. Go to File Types
3. Browse the list of file types (sorts alphabetically, for example JPEG image)
4. Then, select whatever application you wish to open that particular file extension with
5. Click OK when you're done
THIRD SOLUTION:
The easiest solution. If you have a third party image editing software, for example, Adobe Photoshop or Paint Shop Pro, just reinstall it. During the setup process, select Custom Installation. Setup process varies, if the software prompts you which file types to link to the software, you just select the affected image file type and proceed with installation.
FOURTH SOLUTION:
If my memory serves me well, if you have Norton SystemWorks, run WinDoctor to fix your registry. Or equivalent software such as Registry Mechanic. Which I think, may resolve your registry problem.
http://www.pctools.com/registry-mechanic/
Hope this helps.