Some time ago, I summarized the overlay icons that come with Windows. There have been some changes in Windows 7, so I figured it'd be worth coming up with a new list.
- A small arrow. This is still the shortcut overlay.
- A padlock. This means that you have a private item in a non-private directory. (See below.)
- A downward-pointing blue arrow. This is still the "to be written to CD" overlay.
- A pair of green swirly arrows. This means that the item is available offline. This used to be a pair of blue swirly arrows. Apparently, green is the new blue. (See below for more discussion.)
- A gray X. This means that the file has been archived to tape and will take a very long time to access. (Formerly, a black clock.)
A private item is an item where the only user account with access is you.¹ You create one of these, for example, by going to the sharing wizard and saying Share with: Nobody. To avoid clutter, the overlay is shown only when there is a transition from non-private to private. (Otherwise you'd have a lock overlay on everything in your Documents folder, for example.)
No longer present as an overlay is the sharing hand. Why was the sharing hand removed in favor of the private overlay?
Given the changes in how people use computers, sharing information is becoming more and more of the default state. When you set up a HomeGroup, pretty much everything is going to be shared. To remove the visual clutter, the information was moved to the Details pane. What's more, a single overlay cannot express the different ways an item can be shared, so in order to figure out what the deal is, you have to go to the Details pane anyway.
A similar thing happened to the offline files swirly arrows. They used to be placed on every item that was available offline, but feedback from customers highlighted that this was unnecessarily noisy because it trumped other (more informative) overlays. Instead, the swirly arrows are shown only on the root of the folder that is pinned and not on everything contained within it. In other words, the swirly arrows are placed on the thing you clicked on to make the files available offline, and conversely, on the things you need to click on to stop making them available offline. Per-file overlay information is still displayed in the preview pane, but it's been taken out of the icon list.
Generally speaking, overlays are not a good way of presenting information because there can be only one overlay per icon, and there is a limit of 15 overlays per ImageList. If there are two or more overlays which apply to an item, then one will win and the others will lose, at which point the value of the overlay as a way of determining what properties apply to an item diminishes since the only way to be sure that a property is missing is when you see no overlay at all. (If you see some other overlay, you can't tell whether it's because your property is missing or because that other overlay is showing instead of yours.)
¹Even though you are the only user account, there can still be access granted to groups and non-user accounts such as the Administrators group and the SYSTEM account.