Marie
I am no computer expert but have had similar problems.
Not too sure about this but if you are you using Internet Explorer click on Tools...Internet Options.... Security....Custom Level. Then scroll down to bottom of list....to User Authentication. What is the setting ?
Mine is set to the the 2nd one and I have no problem. Maybe yours is set to the 1st or 4th (anonymous or prompt) ? If you don't want to change anything always back out using Cancel at each window.
As for losing your favourites that is nuisance and may need a someone with a very good knowledge of computers to sort it without really messing up your computer. I think it means changing your the Registry settings but I say DON'T go there unless you know what you are doing! The chances are that the Windows Registry setting has changed so Windows doesn't find the correct folder.
However you can at least easily check if the Favourites folder is empty. Click on START then choose Search. Now choose All Files and Folders ....then in the top box type Favorites ....note it is the US spelling without the "U". When the results come up you will hopefully see one which says Documents and Settings etc with your name (if several people log on to your computer).
Double click on that entry and see if your favourites are still there. If so then you need further advice on how to restore the link in the Registry (not me).
To reduce the problem in future I suggest you make a backup of the Favorites folder either on CD or elsewhere on your hard Disc. I have a folder called BACKUPS (wonder why ?) for such things !! I lost mine a month ago after a computer crash but luckily was able to copy the last backup file straight in.
Another alternative as a backup facility is a web-site called
http://www.ikeepbookmarks.com/home where you upload all your Favourites free of charge, as a backup. If you do, then write the address down, and don't just pop it in your Favourites. This site comes in useful for anyone who using Internet cafes.
Dennis