This one is bad. It affects all versions of Windows and currently is unpatched. It works by exploiting a Window Meta File (WMF) and is assisted by Google Desktop (note: NOT Toolbar!) which executes the trojan while indexing images on your hard drive. See
F-Secure for details. You do not actually have to do anything other than load the offending web page to execute the trojan!
There is a workaround listed at F-Secure which requires unregistering the dll file for Windows Picture and Fax Viewer, and also a registry hack found at
Smart Company which can be a bit gnarly for non geeks. The unregistering of the specific dll causes Windows to stop displaying thumbnails. The registry hack is the better (and gnarlier) method.
NOTE that this will only be a problem if you go to "nasty" websites. I assume you all know what a nasty website is?
Personally I'm going with the unregistering of the dll. It's easier to do and easier to re-register, and frankly while I have the skills to muck about in the Registry, I try not to do so, lest I discover a previously unknown lack of skill.