UPDATE: RESOLVED - see my answer below
Frequently, while I'm navigating through folders in a Windows Explorer window (Explorer.exe, not to be confused with Internet Explorer), suddenly I'll hear my hard disk start to thrash and my system becomes unresponsive. When I manage to get Task Manager open (Control-Alt-Delete -> Start Task Manager), I can see that Explorer.exe is using rapidly increasing amounts of RAM, from 1.5GB to 2GB and up. If I watch the RAM numbers for a few seconds, Explorer.exe will go up to about 4GB and then it zeros out and starts over. All the while, my hard disk is thrashing and I can't do anything with my computer. I have managed to get back to normal by terminating the Explorer.exe process and then using Task Manager's Run... command to restart Explorer.exe. These episodes keep my system unusable for anywhere from 3 to 5 minutes.
I have been told that this is a virtual memory problem. My virtual memory settings are fine -- they're set to automatic. I have around 10% free space on all of my hard disks.
I tested system files with sfc /scannow and found no problems.
I tested my RAM using Windows Memory Diagnostic and found no problems.
I've noticed the problem occurs specifically when browsing through folders in the Documents library. It happens almost every time I navigate through my frequently used folders, especially if I move through the folders quickly. It often happens when I'm attempting to open Word files.
The system will "freak out," usually for about 2 or 3 minutes. When I'm able to see the RAM usage during the system, it is up at around 98% or even higher.
One possible complication is that I moved the Document Library locations to a different disk (F:), not the same disk that Windows is installed on (C:), but this shouldn't be a problem.
NEW DETAILS 9/10/11:
I am now experiencing this problem on two different Windows 7 x64 computers. Exactly the same problem occurs on both, with explorer.exe gobbling up all available RAM and slowing the system to a crawl. I believe the following procedure will trigger the problem.
1) Navigate to a folder synchronized with Windows Live Mesh 2011 that contains at least two Word document files.
2) Click (do not double click) one of the Word document files. Then click a different Word document file. Repeat this several times.
3) Perform a file operation. (Delete, copy, or open one of the Word files.)
4) The system will seem to slow down or "freeze" temporarily. If you look at Task Manager, up to 99% or even 100% of RAM will be in use. The explorer.exe process will use rapidly increasing amounts of RAM.
I am more convinced than ever that Windows Live Mesh 2011 is the culprit here. I will uninstall this program and re-test both systems, then update this question with more information. If you have any further insights, please help. Thank you.
Based on excellent suggestions from Superuser, I've done a lot of troubleshooting. Currently, I have mitigated the problem, but I still haven't eliminated it. After clearing the Windows thumbnail cache, the RAM spike and hard disk thrashing I describe above still happens, but the duration of the attack is only about 5 or 10 seconds now (instead of 3 or 5 minutes). Another step that helped was selecting "Launch folder windows in a separate process" in Explorer's Folder Options, on the View tab. This has isolated the troubled window, so that when I need to terminate explorer.exe, my taskbar and desktop aren't usually affected.