Starting iTunes after a recent installation returned the error message “The folder iTunes cannot be found or created”. It was referring to the My Music directory that is usually located in the My Documents folder on the partition containing the operating system. The iTunes software creates an iTunes folder in the My Music directory on first start and if that directory is not accessible it will throw the error message and fail to load.
Since this error is related to the My Music folder it is important to check the directory path of that folder in the Windows Registry. This is best done by using the shortcut [Windows R], typing [regedit] and hitting the [enter] key.
The fastest way of location the two locations that contain path information for the My Music folder is to use the search by pressing [F3] and entering [My Music] in the search box. A click on [Find Next] will start the search and reveal the two locations.
The test computer system did not have path information listed at all. This can be changed by double-clicking the My Music key in the Registry and changing the path to an valid path manually.
The two Registry locations that list the My Music path are the following two:
HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\Shell Folders
HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\User Shell Folders
Make sure both point to a valid path on the system. Once the path has been changed iTunes will create the iTunes folder in that location and start up without this error message.
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A further fix for any folk still unable to fix iTunes problem is described at Apple support
http://support.apple.com/kb/HT1866