How to fix large icons/wallpapers not rendering?

I am facing two (possibly related) problems. First, when I open Windows Explorer anything that is set to display as a large icon does not display correctly. It appears only as a blank square with a filename at the bottom. I can only get this to fix temporarily by changing the icon type to something else and back again. But each time I open that folder it shows as a blank square again. I do not believe the files are corrupted as they render properly in Photo Viewer and other applications, but will not render properly in Explorer.

Second, I am unable to change my background image to a picture. I can set it to be a solid color and can change this color at will, but attempting to set an image gives me "This image can't be set as wallpaper. An internal error has occurred". Similarly to the first problem, when I enter the Personalization center all background pictures appear only as blank squares. I can get this to temporarily fix by zooming in and out, but again, it doesn't show properly on its own and I still can't make it change the background to an image.

Some background - I have Windows 7 Ultimate, it's been installed for several months, and this problem came about after a power failure which caused my computer to shut down, flicker on for a second, then shut down again. Perhaps something got corrupted within Windows that handles pictures? I'm not sure. I have already looked at several tutorials to fix a problem where people get one image stuck on their background and cant change it. This is not the problem I am facing and these tutorials don't help, sadly. I can change the background as much as I please but only to colors, not actual images.

Please help, this is getting incredibly frustrating!