I just installed Windows 7 Professional OEM last night. I have the same problem. The thumbnails show up just fine in Windows itself, but they no longer show up on the devices that I stream media to (the PS3, and the XBOX 360). This makes it really difficult to scroll through your videos to find which one you need, because you are going only by the name with no image to help you choose. Previously, I was on Vista and as the original poster said, all thumbnails would show up on the PS3 and the Xbox 360.
For me, this was a very important feature. I'd really like to find a way to get it working again, or at least think that it will be addressed in an upcoming fix.
Does anyone have any ideas as to why this is happening? Has anyone else run across this?