I click on the folder and I instantly get an error message barring me from entering it, the message tells me that folder has become corrupt and damaged.
Try running ScanDisk, and see if that fixes the problem (it may not, but at this point it can't really make it worse). Right click the drive in Windows Explorer and select properties, switch to the Tools tab, and click the 'Check now' button.
we had put 20-25 hours into the game and it is unlikely that we would revisit it as this would mean having to do all the same quests over again
It goes quicker the second time around, when you have a better idea of what you are doing and can skip a lot of the running around (you can also switch to easy to speed up combat until you get back to where you were). If you don't want to try different character builds, though, I can see where just doing quests in different ways may not be enough variation for an immediate restart.
