Current folder not displaying correctly in Front Page

When users attempt to add a hyperlink to text, the "Insert Hyperlink" window does not correctly dispaly the current folder when the "current folder" option is selected.   It shows the root folder fo the subweb, but does not display the current folder the user is working in.    

This has worked fine for years, then all of a sudden today, several users called in complaining about this problem.  It happens for me as well.  It is annoying as you can't just do your hyperlink in "point & click" fashion.