As I was installing and testing WSS 3.0 SP1 on Windows Server 2008, I was having troubles getting document libraries to open in Explorer view. I was actually using IE on WS2008, an it just wasn't working. The DESKTOP EXPERIENCE features had been installed (a requirement), of course.
Turns out the System Event Notification service interferes somehow with that functionality. By issuing the command:
net stop sens
I was able to solve the problem and view the library in Explorer view. Of course, I'm sure I open an entirely new can of worms and I've not yet had time to research and document the side effects.
So if you're having problems viewing a site in Explorer view, you now know the fix and some keywords for searching for more information. Let me know what you find out by adding comments here.