Whenever I'm in file explorer and I right click, and then move the mouse down to highlight 'new', it will close that file explorer window. It will briefly say 'not responding' in the very top of the file explorer window, then that window will close. I've also noticed that very briefly after file explorer closes, the icons for open programs will disappear from the taskbar.
If I right click on the desktop and go down to 'new', a somewhat similar thing happens. The desktop wallpaper will go away briefly and so will the desktop icons, it goes to a solid color, and the icons for programs that are running will disappear from the taskbar. Seems like explorer is restarting? I'm just spitballing.
Maybe relevant, the submenu for the 'new' option won't open. It won't show the 'new folder' or 'new shortcut' options that normally pops up. It just starts doing that closing behavior.
HKLM\SOFTWARE\Classes\Directory\background\shellex\ContextMenuHandlers\New. Set the default registry value as