Do you have Windows drive indexing set to OFF for all drives and directories?
I did not, but after your suggestion I moved them to off, and disable the windows search service. Rebooted. Still seems to have the same problem. thank you for the advice!
Which, if any, anti-virus program do you have runnng?
Have you updated to CS 5.0.3?
Running 5.0.3, I did have Symantec Endpoint protection running - had the problem, uninstalled and tried Microsoft Security Essentials - still had the problem. I have not been able to get back on the machine to uninstall MSE. I will try that in a minute.
EDIT: Situation persists after uninstall of MSE
Not responding is a Windows message, not an Adobe message. It can be indicative of background processes stealing CPU/memory from your system. SEP is not likely to be the cause, that is a pretty well behaved program, but something else might be, especially with only 8 GB memory. You could try this article, which also applies to Win7: Adobe Forums: Guide for installing and tuning a Vista...
Make sure you have indexing and compression turned off on all your disks, the sidebar, MSN and similar crap permanently removed, Aero turned off and turned off all unnecessary services as shown in the Black Viper list. If that still does not solve the issue, consider adding some additional memory and defragging your disks.
Thank you, I will implement these changes today and report back.
EDIT: Implemented above solutions, seems to be acting better - it still hangs a bit opening and closing the preferances window, but seems to be less intrusive.