Windows 7. But now I prefer Windows 8 now that it's out. Nothing you said confirms anything however, because it's all based on your fixed opinion about Windows 7. I haven't seen anybody else complain as much as you to be honest, so that must show something...
That kind of attitude isn't going to get you far though, so I can't help you.
If you can't deal with not having headers for every letter, then god help you. I can sort by name alphabetically, click anywhere in that folder, and hit the key for the letter that I want to navigate to, and it does the trick just fine.
I've used Windows since before Win95 and I would have to say that I have managed to work with all of the explorer's without much hassle. Obviously it was more limited back then, but it's only improved upon the last for every Windows release. Performance-wise things got faster too. My XP machine can't handle this many folders almost, and the hardware in that tower is just fine.
If you right click inside of the folder, "Group By", then choose "More", maybe you'll find something that you like by selecting which group by options you have in that listbox?
Otherwise, you can create a batch script that would organize your folders into each folder letter as a category if you are going that way...