As test to localize the issue, reset the Toad for SQL Server user settings folder.
1. Open Toad.
2. Go to Help | About in the Toad menu bar.
3. Click on the blue link "Application Data Directory". This will bring up a directory similar to C:\Documents and Settings\<User_Name>\Application Data\Quest Software\Toad for SQL Server 5.8.
4. Go back one directory up from the path till you see the Toad for SQL Server 5.8 folder.
5. Close Toad and then switch back to the Explorer window.
6. Rename the folder with the extension *.OLD (i.e. Toad for SQL Server 5.8.OLD).
7. Close the Explorer Window.
8. Launch Toad again.
This will regenerate the version folder and reinitialize to the default settings.
When prompted do not migrate from a previous version folder.
The reasoning is to avoid migrating back a potential corrupted file.
