This is also something that happens to me. I didn't realise it was a windows problem though I just thought it was DW.
What I do as a bit of a workaround is when browsing for a folder I go one level deeper (if a folder one level deeper exists) and then it works fine.
So if I want "uploads" and within the uploads folder there is a folder called "notes" then I choose "notes" and then the "uploads" folder is selected.
Hope that makes sense.