[ Thanks to kiterunner for this link.
” I found this strange new bug with two brand new Ubuntu 11.10
installations of mine. When I tried to change the default
application for AVI files from Totem to SMPlayer, an error came up
with the warning that says, ‘Could not set as default. Error while
setting ‘SMPlayer’ as default application: Can’t create user
application configuration folder
/home/manu/.local/share/applications: Not a directory’.”