Creating a new folder works for fine for me. I can navigate with the file navigatation dialog box, and create a folder with no problem. I haven't created a new library.
Lightroom is working well for me with Vista. The only problems I have encountered with Vista, are file import from a CF card (a known issue) and secondly converting .nef files that are in my library to the .dng raw format can be extremely slow. The .nef to .dng conversion slowness is something that I am having trouble reproducing, however, so I am not sure if it is a Lightroom problem, a Vista problem, or some combination.
I am running Vista 32bit.