Alright, altho it's all been said and the thread is marked as solved, I would like to mention a few things.
First, this is my first post here, found the place with google trying to save this copy.exe problem.
Second, I'm gonna explain the problem for any future readers. This is what happened to me: My anti virus (panda antivirus + firewall 2007) after scanning C: found copy.exe as a threat (The scan was after having used an infected USB flash disk, that's where the problem started from I guess) and deleted it.
After that when trying to open ANY drives wether on my internal HD, external or even the usb flashdisk it gave the error mentioned before "Windows cannot find 'copy.exe' blah blah". Don't panic, you can access your drive by right clicking and choosing open. Why is that? Because if you look in the right click menu, the highlighted (default) option is Autoplay! That's what "raddbgt" mentioned, on all these drives there is a autorun.inf file which is the reason for the Autoplay. The Autoplay is supposed to run copy.exe each time you double click on a driveand once copy.exe is deleted, it will give you the error above.
The solution is to go to each of the drives and delete autorun.inf. After a reboot or logging of and logging in the problem will be totally solved.
BTW, thanks for the great forums

-Ali