Well... that's Vista.
What you are seeing certainly are not all the folders on your C: drive. You see only the links (and maybe only some of them, actually).
You know, when you install Vista, it creates quite a strange system of NTFS links on the system drive. They are not real folders - they are only virtual objects, "pointing" to different folders (when you enter such a link ("folder"), you actually appear in a completely different place of the directory structure).
Some of the links are there for compatibility reasons I guess, but why create that crazy structure the Vista installer builts, that's beyond me. I guess Microsoft programmers must have been pretty drunk when they made this. Oh yes, there are even circles in this structure.
Now, some of those links take you to a different folder (so you can access files from that folder) - but simultaneously, they restrict the access rights - so you are in a different folder, but you can't see the content.
That's what you see here I think. When avast! enters "C:\ProgramData\Desktop" folder (which is just a link) during the scan, it actually gets redirected into C:\Users\Public\Desktop (the real folder). But - it's denied the rights to list the content of the folder - so it doesn't scan anything there, and reports an error (at least when running under a restricted user account). It doesn't really matter, however - when avast! arrives at C:\Users later, it scans its content normally (well, if you have the corresponding access rights, of course), so you won't miss anything.
Now, I must say there's one thing that's rather strange here - the error itself. The error should be "Access denied" (I can reproduce the behavior here)... not "Path not found"... looks like something else might be going on there as well.
But the main thing is that no files are skipped because of some error - the reported folders are just links, and the real content is scanned elsewhere (throughout the scan).
If you're willing to check something, I can build a special executable that you'd run and report the results back; if we're lucky, it may tell us why the strange error type.