For several months now whenever I double click on a folder on my desktop via the Finder under OS X Leopard Finder closes my active window rather than opening the folder as it should. Moving this folder somewhere other than /Users/somas1/Desktop/ allows me to open folders as expected. The only way to currently to open folders on the desktop is to hold down the option button while double clicking. What exactly is going on here and how do I fix it?
I haven't been able to reproduce this symptom, nor find a combination of controls in System Preferences and the Finder Preferences that would account for it.
It sounds like the finder thinks that the option key state is opposite from what you think it is. That is, closing the existing window when opening a new one is the expected behavior when the option key is depressed.
Do I understand that this effects only folder on the desktop?
If so, control-click the desktop to bring up the contextual menu, then go to
More...:Configure Folder Actions..., and see what is active for that folder.