The NTFS filesystem of NT4/W2K/WXP/WXP64 supports HardLink functionality, but HardLinks can only be created via the POSIX command ln, which is shipped with the Windows resourcekit. Even if with POSIX commands, HardLinks can only be created via the command prompt, which is a kind of a mess for many files.
The Link Shell Extension implements an extension to the Windows shell explorer, so that HardLinks, Junctions, and SymbolicLinks can be comfortably created via right mouse click on a selection of one or multiple files.

What's New
With W2K the junction creation was broken.
Fixed a handle leak caused by enumerating hardlink sibblings under non Vista/W2K8
Under Vista & W7 some can create junctions everywhere without elevation, but not in e.g c:Program Files. LSE is now aware of this and asks elevation for junction creation when neccessary.
With drives mapped via a Remote Dektop session, the whole explorer & remote desktop session hang, when this drives was expanded in explorer, but only under W2K3 as terminal server.
Support for Windows7
Hardlink Sibling Enumeration now also works for XP, W2K NT4, but due to OS contraints not that fast as with Vista.
Under W2K it turned out, that CreateHardlink() from kernel32.dll with long pathnames (e.g. \?) was broken.
Fixed a memory leak in serving as COM server.