Some time this month my desktop decided to die after three years of proud service. I ran all kinds of diagnostics and found out that it was due to my GPU constantly overheating (it was due to dust completely blocking off the airways of the heatsink). So I replaced the motherboard and the GPU and got a new copy of Windows (because apparently Windows recognizes a new motherboard as a completely new computer). I left the other partition and hard drive intact, hoping that my games are still runnable after a fresh new install.
I reinstalled Steam in the same directory on the other partition where it was before, and it recognized all my games there instantly. It even read my previous download queues. For a week I let Steam download most of the Steam games from the Valve Complete Pack, which I have bought for $50 during the Valve Summer Sale).
After acquiring an almost complete set of Valve's source games (HL2 w/EP1 and EP2, TF2, CS:S, DoD:S, etc.), Steam started to act weird and froze frequently. It freezes the first time I start it. I'm getting pissed with this because my PC is new in a sense, and that I haven't even done anything with Steam when it happened. So something was definitely wrong there.
I googled for some solutions and they recommended turning on background processes and services. So I did. I even got to turning off MSE for a while, but still to no avail. I even deleted the .blob files inside the Steam directory so that it could update itself again, but still, it completely freezes.
At some point I just let Steam freeze and unfreeze itself while running. Then a dialog box showed up telling me that my Steam game files are horribly fragmented. Then I realized that file fragmentation was the cause of Steam constantly stopping.
I ran Defraggler and I let it analyze the drive where Steam was located. The result was both surprising and sad: The total size of the fragmented files has reached 38.6GB. That's the largest amount of file fragmentation I've ever seen, since I constantly defragment my NTFS partitions. So I let it work its magic, hoping that my problem with Steam will be fixed after defragging.
The real insult here is I get these shitty problems when I've already bought legal copies of games. I've done Valve a great favor buying their games instead of pirating them (which was what I have been doing for eight years until now), and now I'm faced with this dilemma with Steam.
I will edit this post and write an update if Steam gets fixed by Defraggler or not.