Access Violation error when changing the application data directory folder in Toad for Oracle (4331237)

This issue occurs after installing Toad for Oracle 12.8 on a system where a previous installation of Toad for Oracle 12.1 is present .

In this scenario, the application data directory of the 12.1 version was previously changed from the default path (C:\Users\<USERNAME>\AppData\Roaming...) to the local default (C:\Users\<USERNAME>\AppData\Local...).

The user opens Toad for Oracle 12.8 and navigates to View | Toad Options | General and clicks on "Use local default". Clicking on "Apply" generates the following error message:

"Toad for Oracle has encountered a problem. We are sorry for the inconvenience.
Access violation at address 000000000854B964 in module 'Toad.exe'. Read of address 000000000000002C.
To see what data this error report contains, click here."

This error also occurs when attempting to set the application data directory to a different path than the local default one.