I ran into this problem when the company where I was working used Novell Netware network. When the users were switching Explorer View in any document libraries they received a very simple error message about the WebDAV client. After searching through the internet without any success we dug deep into the problem ourselves and we found that the WebDAV client is simply not registered on the client computers (Windows XP).
So the following two registry keys' values must contain the word "WebClient" to be able to use WebDAV:
After this registry modification you must reboot your computer.