Yes Tom, when I am in COLUMN VIEW, my screen looks just as your does.
Then, as I said, nothing is being copied into those folders.
The problem is when I am NOT in column view.
Are you using list view, then? Note the four buttons in a group in the title bar on my screenshot... when you double-click folder "one," in my example, do you see the second button highlighted in that group? That would be list view.
Note that the title of the window in the Finder shows the name and icon of the folder you're looking in. I'm guessing that, however you're getting to this window, the title says "Desktop" and is showing all the items on the desktop with a gray triangle to the left of each folder, allowing you to expand it and view its contents. If, OTOH, you see the title say "one" and are seeing the entire contents of the desktop, then you've got something serious wrong.
The next question is how exactly are you getting that window open? If I set the folder "one" to open in list view, then when I double-click on "one" on the desktop, I get a window showing only the contents of "one". Are you opening that window in a different way?