How to Restore .lnk Functionality

Problem: you click on an icon/shortcut and instead of launching the application or shortcut, you are promtped to Open, Save or Save As.  Windows doesn't know how to handle the .lnk anymore.

To repair the mis-association, open a Command Prompt and type:

assoc.lnk=lnkfile

Press Enter and you should be good to go.

source: http://superuser.com/questions/92869/how-to-reset-shortcuts-lnk-file-in-windows-7

AND...

OPTION 2 : Remove the unwanted registry change


Click Start Menu, and then type regedit in the Start Search and press ENTER.
Browse to the following registry branch:
HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\FileExts\.lnk
Click on the arrow to expand it and delete the sub-key named UserChoice.
[attachment=2510]
Exit from Registry Editor and reboot your machine.

source: http://malwaretips.com/threads/how-to-fix-lnk-file-association-error.10825/