[DjNDB]

Are you running the game in any compatibility mode, if so, which one?

It's possible that your issue is caused by having multiple prefs.prop files, which sometimes happens for unknown reasons.
There should be only one prefs.prop, and that's in the savegame folder:
Win Vista/7: %USERPROFILE%\Documents\Telltale Games\The Walking Dead
XP: %userprofile%\My Documents\Telltale Games\The Walking Dead\

If you run TWD in compatibility mode for win95 or win98/me it might save to:
%PUBLIC%\Documents\Telltale Games\GameData
or
%PUBLIC%\Documents\Telltale Games\The Walking Dead

Mac: ~/Library/Application Support/Telltale Games/TheWalkingDead/

Please check if there are additional prefs.prop files in the install folder
(e.g. \Steam\SteamApps\common\the walking dead)
or its subfolders.
If so, make a backup copy of the prefs.prop and delete it from the install folder.

If that doesn't help, make a backup copy of the savegame folder's prefs.prop, and then try copying the install folder prefs.prop to the savegame folder.