I have this problem with 8.1 and now with 8.1.1 on two Windows 7 systems using an iPhone 5 - One problem I see is that "Local Disk" ghost files appear in Windows 7 Explorer. Have deleted the iPhone drivers using this method. First I created a Windows batch file to show all hidden devices and every driver installed on the system (normally not visible unless the device is attached)
HiddenDeviceManager.bat file:
echo. off
set devmgr_show_nonpresent_devices=1
start devmgmt.msc
Create and execute the batch file with Admin authority; then select "Show Hidden Devices" on the Device Manager options, then locate "Portable Devices" and you should see under this heading "Apple iPhone". This iteration of Device Manager will display every driver that has ever been installed for any device on your system, whether it is in use or not. Now RIGHT click on any entry for "Apple iPhone" and select "Uninstall" to uninstall any Apple drivers and then reinstall them by simply unplugging and re-inserting the device in a USB port.
With a fresh driver install there is no change. There happens no new driver since 2006 anyway. Problem is not resolved
Note that even though Windows allows you to open the "Apple iPhone" Portable Device and select the "Internal Storage" folder, if the pesky Trust/no-Trust question has not been answered the folders will appear empty. You have to close and reopen the folders for the second time after an answer of "Trust" is submitted. With the verification of proper driers and re-installing them, the problem still persists.
More info on the driver for the device:
The driver under "Portable Devices" is listed as "Apple iPhone" and it is associated with:
Driver Provider: Microsoft
Driver Date: 6/21/2006
Driver Version: 6.1.7600.16385
Digital Signer: Microsoft Windows
Driver details:
Hardware Ids: USB\VID_05AC&PID_12A8&REV_0510
USB\VID_05AC&PID_12A8
There are other problems with trying to manage this iPhone 5, as well as an iPad 2 on my two Windows 7 systems with recent versions of iTunes. But this is a separate issue which appeared long before the "Local Disk" ghost problem and the failure to go to sleep problems wereintroduced to my iPhone 5 when I upgraded to iOS 8.1 On one Windows 7 system, iTunes will not even recognize the device for several releases of iTunes now. I have worked hours and hours trying to resolve this issue, trying every suggestion by Apple (I have to say I love your sense of humor Apple for how often you suggest a fix of "try another computer") I have stripped out drivers, reloaded every component of iTunes and all Apple software, plus removed the hidden Apple folders in the c:\Windows\users\name\xxx hidden directories and begun with a fresh install after a full delete of everything, nothing will make iTunes recognize the iPhone 5 or an iPad 2. All other USB appliances work as expected, incidentally and there are no unassigned drivers in Device Manager, indicated as ⚠.
Forgetting iTunes for the moment and it's lack of any longer recognizing Apple devices on Windows 7, plugging the iPhone 5 into a USB port on the Windows 7 system causes the conventional Windows USB selection menu to appear with an option to open the folder to view first "Internal Storage" and the "DCIM" folder. Now with the iPhone 5 with iOS 7, I was able to drag and drop files on/off the iPhone to the Windows 7 explorer image of the folder and to move, copy, delete etc. orchestrated via Windows Explorer After loading iOS8.1 and more recently iOs 8.1.1, this is when the ghosted "Local Disk" entries started appearing in the sub-folders under DCIM which then began to prohibit conventional drag and drop for managing JPG, PGN, MOV files without receiving the notice that "Windows Explorer has stopped working". I could however, open "My Computer", right click on "Apple iPhone" and select the "Import Photos" option which would pull the photos off the camera and automatically stuff in the My Pictures Windows folder. Still the conventional drag/drop has begun to fail with iOS 8.x
Also note that I have an old XP system that I seldom use. I took a couple of hours to install all the latest system and browser updates plus a fresh iTunes install. It was only on this XP system that I was finally able to back up the iPhone (something that started failing last year using iTunes on Windows 7, at what exact release or time I can't recall). Additionally I was able to use conventional drag and drop to pull photos off the iOS 8.1 & 8.1.1. iPhone 5 using conventional XP explorer. iTunes on XP also had no problem communicating with this device. So I finally got a good backup of 8.1.0 and at last was able to upgrade the iPhone to iOs8.1.1, all while using XP.
I had hoped this 8.1.1 update would resolve the problem introduced with the initial install of iOS 8.1.0 last week on the iPhone 5, and that the problem where the iPhone 5 device processor and screen no longer go into standby mode and where the battery drains within a few hours.
Overall my opinion is that someone has dropped the ball with recent versions of iTunes on Windows 7 and especially with the iPhone 5 and its upgrade to iOS 8. Maybe this is supposed to give us incentive to hope that iTunes communication would work better from an Apple desktop, but with my phone contract ending this month, there may be other more logical choices for me. I'll have to admit, I would miss those $30 Lightning cables a lot, though - generic yet functional is always so boring ;-)