If you run a network where you connect Windows XP to DFS shares, you may encounter the issue whereby a user can create a new file/folder but not see it until they refresh the folder, this can lead to a large number of 'New Folder' entries if the user believes that they have not actually created a new folder.
The issue can also occur when moving or deleting items.
Microsoft list a fix which consists of a registry entry, apparently this was introduced in Windows XP SP2 but you can still get the issue with SP3.
The fix is a registry entry in the following path
It is a DWORD entry and is called 'NoSimpleNetIDList'
the value needs to be set to 1
Microsoft Support Information