actually, if I can add my tuppence to this subject (the icon, not mouser's selling out!), I encountered the same issue, which was fixed with a reboot. Symptoms were the same as reported by superboyac (I guess).
This happened when drag/dropping a shortcut from my desktop into a menu in the Launchbar configuration window. It only ever happened with that one shortcut, which had the particularity of being a shortcut created by the installer of an application. Because of this, the shortcut, even though it is visible on my desktop (and that of every other login on my machine, I suppose), actually exists as "C:\Windows\Installer\[stupid big number]\_[other stupid big number].exe".
As a property, it is impossible to modify it much, and in particular it is impossible to change its icon. Could this also mean that LBC cannot retreive the icon information? It certainly tried to use the "c:\windows\..." path correctly.
I case you want to try to reproduce, you can download the related application here:
http://www.softpedia.com/get/Others/Miscellaneous/DICOM-Inspector-NET.shtml. (I am not trying to advertise for them, note, although it is another rather excellent free application, if not applied to a somewhat specific field). I have also attached the "_[other stupid big number].exe" to this post, in case it helps, but I would not recommend running it in isolation.
'hope this helps!