I'm not sure myself -- I rarely use tiffs and use Lightroom and Bridge for my main photo browsing so never paid much attention to how DPP or windows viewers handled anything but Raw and jpeg.
So, I first used Windows Explorer to browse folder with a few tiffs generated by Lightroom and saved by Photoshop and turned the thumbnail on (I have the Raw viewing utility for XP) and the thumbnails don't show. I can right-click them to open in Photoshop, but I can't double-click them and open them in the image viewer.
I then opened an image in Photoshop, flattened the layers (all my tiffs are 16 bit with layers), converted it to 8 bits and saved it as a new tiff -- still no thumbnails.
Then, I ran into something really strange -- when I opened DPP, not only did the "regular" layered tiffs not generate a thumbnail (as you observed -- just gray squares with an "X" across them -- but DPP failed to even "register" the gray-quared tiff that had been flattened and converted to 8 bits -- the program threw up an error message and forced a shut down. It repeated this until I deleted the file in Explorer.
So, beyond my confirming what you're saying, I can't say more -- I only recently installed DPP, never used an early version, and I actually don't use it (I installed it mostly for eveluation and for offering some input here on POTN). And, I rarely even go into Photoshop and leave at tiff behind so I don't have a lot to offer at this time.
Sorry...
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