Okay. I've had this same exact issue. I had to reboot my computer due to a crash and a lot of my features (like this one) were no longer functioning. I wish I could take credit for finding out how to do this, but it took me lots of research and someone else had the answer for me. First off, using Vista Home Basic, this feature is just not available. Anything beyond that and it is. This it to inform you how to recover this option if it is available, but wont let you select it.
Because Vista has numerous versions, it needs a way to detect how efficient your computer is running in order to use as many options as you would like. They created something which essentially "grades" your computer, to avoid crashing it by over-using it with features that seem to slow down your computer. This is KEY to remember, because this is most likely the issue with not being able to turn on the taskbar thumbnail feature. In order for this feature to be able to be used, your computer must register a minimum of a 2.7 overall performance score. If you have recently rebooted your computer, it will automatically default your score to 1.0 so here is how to reset it:
1) Click on the Start bar icon and select Control Panel
2) Once the window opens select the System and Maintenance option
3) After the window advances to a new screen, scroll down until you find the option Performance Information and Tools and select that
4) This should advance it to the screen you want. From here you will see a number at the right of the screen labeled Base Score. What this represents is the lowest score of all of the component subscores
5) On this screen select Update My Score under the Base Score (note that you must be the administrator in order to run this option). After about five to six minutes, your computer should reset the scores for all of the components and label your Base Score with the lowest component score.
6) Once all of this is done, restart your computer (given your Base Score is high enough) and login once again. Give your computer a second to setup everything then it is as simple as right-clicking in the taskbar and selecting Properties and checking the box for this feature.
I hope this is helpful to everyone, especially you Ubapook, and anyone else who has had this problem. It took me almost a month of searching to find this solution and my hope is that if it is out there even more, it will make it easier for others with this problem as well. Anyone who is confused by this post a reply