I don't mean your download folder - I was talking about what files are in your library. These may or may not be shared, depending if you've chosen to share files in your library (by default they're not shared in LW 5)

Anyway, if files in your library aren't the issue - try updating your Java. Go here Java SE Downloads & download the JRE offline installer.
Next, remove any Java versions already installed on your computer via Add/Remove Programs or Vista's equivalent.
After that, install the Java that you just downloaded. Restart your computer.

Hopefully things will work properly now