I don't want zip files to appear as folders and I don't want to search thru zip files when I using Search. How do I stop this?

The best way to completely remove this feature is to unregister the dll-file zipfldr.dll. To do that, follow these steps:

Click Start->Run and type regsvr32 /u %windir%\system32\zipfldr.dll
This will take effect immediately, but you have to restart Windows to get all traces of zip support to disappear

If you wish to re-enable the support for zip files, register the file again by doing this: