I just upgraded from Windows 8.1 to 10 and I noticed that all my folder thumbnails are being stretched for display.
The picture is a montage: the three entities presented are not in the same folder but the first one (the "folder.jpg" image) is inside both "Big Bob" folders. The first folder is the Windows 10 display, the second is the Windows 7 display. I did it this way so you could see them side by side and compare. As you can see, the Win 10 folder thumbnail has been stretched and cropped while the file itself and its own thumbnail remains at the correct ratio and isn't cropped.
As qasdfdsaq mentioned in the comment that he believed the Win10 picture wasn't stretched, I provided the Win7 version for comparison. As you can see, the Win 7 thumbnail has been transformed with a deeper perspective and yet it looks much thicker than the Win 10 version. So I stand by my assumption that the win 10 version is cropped and stretched.
I have this weird occurrence on every single folder, whether it contains a "folder.jpg" or it displays previews of image/video/music files that are inside it. I didn't have that on Windows 8.1 (nor on 7).
I tried removing the thumbnail cache and letting it rebuild by cleaning the system drive and by manually removing the thumbnail cache, but it rebuilds the same way (stretched and cropped) with both methods.
Couldn't find anything more on the web, so any help is greatly appreciated.
EDIT: It's worth mentioning that neither the size nor the ratio of the original picture has any effect on the result, except that if you use a square picture, it won't be cropped (but it will be stretched vertically).
EDIT2: If someone with Windows 10 can post in the comments if he/she has the same problem or not, that would be a good start for troubleshooting this one. Thanks.