Your situation suggests two approaches:
1. Increase the icon cache size. An explanation of why, and how, is done quite clearly here:
1a. As part and parcel of the above, please use TweakUI from Microsoft to 'Rebuild' the icon cache after the adjustment and a reboot:
2. Use the Microsoft resource kit tool. I have this installed and have rarely needed it after making the above changes, but it is nice to know it is there always. I am quoting from a reviewer just as happy to have it as I am:
Tool: Two files from the MS Windows NT 4.0 Resource Kit (26KB). Download them from here:
This is one of my favorite tweaks because I'm a real neatness freak about my desktop icons. Basically this tweak allows you to save the positions of your desktop icons, so you can restore the icons to their saved positions at any time in the future. To give you this added functionality in XP, do the following:
1. Download the file Layout.zip from the link under Tools above, and extract the contents to an empty directory.
2. Copy Layout.dll to the \Windows\System32 directory on the hard drive which contains Windows XP.
3. Double click on the Layout.reg file to automatically make the appropriate changes to your registry.
4. Now go to your desktop and arrange the icons as you'd like them to be saved.
5. Once done, right click on the Recycle Bin and select 'Save Desktop Icon Layout'. The positions of all the icons are now saved. You can move the icons around freely, however whenever you want them restored to their original saved positions, right click on Recycle Bin again and select 'Restore Desktop Icon Layout'. Bingo!
This is particularly handy if you're installing new graphics card drivers for example and your desktop icons get messed up, or you change resolutions and they get bumped around, or if you accidentally move an icon while trying to double click on it.
Best,
Bill Castner