When I click on the 'Create' button in the Schema Browser for package, procedure, or function I get the following error after I click OK to create the object.
The PLSQLTEMPLATES paths in the toad.ini are pointing to the work path. This could happen if you manually copy the User Files which contains the toad.ini from a XP machine to a Vista or Windows 7 machine.
WORKAROUND 1:
Open the toad.ini and edit the path manually
Template paths can also be verified In Toad, via View | Toad Option menu option. Navigate to Proc Template section. Click inside each file name, to ensure it has the proper path. Hit OK to resave changes.