All of a sudden my cmd prompts in Windows 7 had no PATH environment variable. And when I tried to change my path (Right Click on My Computer -> Properties -> Advanced Settings) I got a terrible error message about %windir%\systempropertiesadvanced.exe not being found.
Bottom line, if your PATH environment variable is more than 2048 characters it (and WINDIR) stop being visible in many contexts.
I fixed it by manually running c:\windows\system32\systempropertiesadvanced.exe and deleting one entry from my PATH to put me under 2048 chars. New cmd windows work just fine.
Interesting that you can't use the GUI to increase path length above 2048; only badly behaved installers are allowed to do that?
Props to http://www.sheldor.org/index.php?post/2011/03/03/Windows-7-WINDIR-missing-issue for pointing me in the right direction. I haven't found any other acknowledgement that this issue exists.