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when I go to certain web-sites now(such as Amazon.com/ebay/there is a yellow tab on the right side in the middle of the page that has "Local directory" written
on it. what is this and is this something new? If so, how do I get rid of it
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It might be a feature of an add-on. Could you review the list on the following page and disable everything that is not essential, restart Firefox, and see whether it goes away:
orange Firefox button or classic Tools menu > Add-ons > Extensions category
By the way, you are not really running Firefox 4.0.1 are you? There might be a problem with the forum's version detection; you can check Help > About Firefox for the true version. Version 4 contains numerous publicly disclosed security vulnerabilities and is dangerous to use on the web. You should update ASAP.