Just spent a while adding folders to the Favorites folder in Vegas 5. I quit, then re-started the app and none of my Favorites were there. Thinking I was going mad, just tried again and the same thing happened.
I mention this only because it appears to be potentially related:
Vegas 5 also does not appear to always " remember " last used from " File". Also, in the past if you went to " Open " it would open the folder you last used, it isn't doing that for me now. It keeps going to a project I did two weeks ago although I haven't accessed it in a while and none of the " temp " directories or such are pointed to it.
Yes, I can repro this problem if I set up Favorites with a large number of folders, or their combined actual paths and names are very long. The character count in the paths can add up very quickly when you are adding folders under your My Documents folder to Favorites.
There is a maximum of 1024 characters in all for saving the combined full paths plus their names in the Favorites folder. When this is exceeded, unfortunately none of the Favorites are saved. I have bugged this, Vegas should save whatever it can before hitting the limit.
As a workaround, you'll need to add fewer folders to the Favorites. Since Vegas saves the list whenever the explorer window is closed, I suggest whenever the list is getting long, add just a few folders at a time to Favorites, Next close the explorer window and reopen it (View | Explorer) within Vegas. You'll know when you've hit the limit because none of new folders you've added will be in the Favorites.