Originally Posted by ScriptKeeper
Right, as suspected Notepad++ must have had something to do with it.

I reinstalled MS Office 2003, changed some preference settings in Notepad++ and rebooted. Now when I right-click I get the option to open a new Notepad++ Document which opens a new .txt file as required.

Could you be more specific as to the full issue and versions?
I install Notepad++ on all my workstations here and I have not run into any issue so far with regards to what you're talking about.