To fix the missing new option, you can download fixnew.zip, extract the file fixnew.zip and double click on it.
This will correct the registry and should restore the new function.

Another possible solution if this does not work is:

If you have Internet Explorer 4 installed
Click on start | run
In the run box type:
Regsvr32.exe /i shdocvw.dll
and click OK.

If you have Internet Explorer 5 installed
Click on start | run
In the run box type:
Regsvr32.exe /i shdoc401.dll
and click OK.