I don't know if this is still an issue for the original poster, or if he's gone back to WinXP :)
But recently I was having this annoyance myself.
I wanted to display the contents of a folder (not a library) in detail or list mode, with the most recent on top. However, the default behaviour is to have the folders at the bottom - NOT what I want.
After a LOT of fiddling, I realised that this only happens when the "Date Modified" field is used for sorting. I have found that by using the "Date" sorting field, the folders appear at the top as they (imo) should be.
So, to recap:
- Go to a regular folder (NOT a library)
- Right-click the field header area
- If present, put a tick next to "Date"
- If 'Date' isn't there, click 'More' and find it there.
- Move the new Date field into position, and click it to sort on date.
Hope that helps :)



