If you set your environment variables (Start > Control Panel > System : Advanced tab; click Environment Variables) to use %SystemRoot% instead of explicit paths (say, C:\Windows), MSVS 2005 does not understand %SystemRoot% or it resets its entries... ...or both. Don't just believe what the list box says; Edit the item and you'll see the differences.
What you must do is change MSVS 2005 options (Tools menu > Options > Project and Solutions > VC++ Directories) to ensure that
are specified BEFORE $(PATH).
Setting your system's environment variables to use $(SystemRoot) rather than %SystemRoot% (indeed, even using %SystemRoot%) is not a good idea: too much (MSVS 2005 as well as other applications) seems to break.
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