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I missed what was said prior to the edits on the earlier posts but, from the comments that remain, it appears the preference settings got corrupted somehow. To begin again with a completely clean install, first rename your "system3.1.07.42" directory to something else (maybe badsystem3.1.07.42), then follow a slightly modified version of your 3 step process:
1. Copy existing sqldeveloper-3.1.07.42.zip.
2. Extract the sqldeveloper-3.1.07.42.zip file into an empty directory*
3. Run sqldeveloper.exe but do not accept the offer to migrate settings*
4. You can try retrieving your existing connection definitions by importing from the old connections.xml file.
Of course, downloading and installing the latest production SQL Developer (sqldeveloper-3.2.20.09.87.zip) would be even better.