It was a Java bug, that affected the version included with the packaged installer. As far as I can tell, but I'm not exactly a Java programmer, the JFileChooser class wasn't able to handle that special folder and the desktop contents gets parsed by default. Putting the God Mode folder somewhere else, doesn't automatically trigger the bug, but I guess it would still happen of you open that locate.If you have time, could you drop me a note offline (or point me to some documentation) about why God Mode causes this issue -- I'd always understood it to just be an undocumented shortcut menu within the Control Panel.
If you want to dig further, you can find some relevant Java bug reports in this older thread here.
Reinhard