For what it's worth, it appears to work on my Win7 setup. I also noticed you can bulk select a whole group of shortcuts, and use the tool on them all in one hit!

Very well done. I only have a hundred or so games, and I wasn't looking forward to doing this s**t manually, so I can't imagine how it'd be for anyone with more then that. Why the hell don't steam do it like this to begin with!?