Hi dmh, welcome to BC!
Yep, this happens to me every now and again. Here's my thread on the subject: http://www.bleepingcomputer.com/forums/t/120551/odd-favicon-behavior/
I should have updated that thread to say that I've sort of found a solution. That is, I now delete all my temporary files on a regular basis (should do anyway). I've noticed that they always contain a lot of favicon files. This obviously doesn't solve the problem, but at least it helps for a while.
The Microsoft solution linked to in my thread doesn't cover the favicons; it's about desktop and system icons, so that didn't help any. Glad I realized that before I started messing around with my registry.
Edited by Dialer, 30 December 2007 - 11:38 PM.