Remedy:
Simply close the context menu from time to time by clicking somewhere on the Desktop.
Detailed explanation:
OS/2 does not provide an unlimited number of menu items for submenus. Every menu item
must be assiged an internal identification number (ID) to. For these IDs, XFolder uses
0x6500 (decimal 25856) plus the number you specified as an "offset" in the Global Settings,
and assigns a new ID to every single item which appears in the context menus. However,
OS/2 begins to behave in an unpredictable way if menu IDs larger than 0x8000 (decimal
32768) are used, so XFolder aborts menu processing as soon as this limit is reached.
Upon opening the next context menu, counting starts again from the beginning, so this
error should not have any consequences.