"Create new folder" not available on HDD

Windows 7 Home Premium x64

I was helping my friend install his new WD 1TB Blue (he was previously just running an SSD but needed space for games). I plugged it in, got it initialized in the disk management window, created a 950GB NTFS partition. All went smoothly

Then I went to create some folders so when he installed games, he could keep them organized (i.e. a Steam folder, an Origin folder, ect.) I right clicked to create a folder and the option wasn't there. I assumed that it was set to read only, so I opened the permissions of the drive and set him to the owner and gave him full permissions.

Still no dice. So I tried to do the only thing that it would let me create, a Zipped folder. Once that Zip folder was made, it was marked as read only, even though the drive is set to read/write and he is the only owner.

I read on another forum that sometimes the drive is marked as read only even when the partition isn't. So I took their advice and went to diskpart.exe in the console and turned off the read-only flags on both the partition and drive (even they were already set to off).

I am still having no luck with this, and he is obviously frustrated because he spent $60 on this drive and he can't use it. I would really rather not re-install Windows, as he has a lot of stuff saved/installed on it.

I also downloaded a set of registry files from a technet.microsoft.com forum post titled NewFolder.reg that was supposed to fix this, but that failed to work as well.

This is the code I used in the NewFolder.reg

Any help is appreciated!

If you right click in windows 8 they moved the create new folder option to new > folder or something like that.

He has Windows 7. And I know how to create a folder haha. :p