The 1.6.5 and 1.6.6 release notes say that you need to:
- Uninstall TinyMCE (but don't remove it)
- Reinstall it, and put your settings back
- Make sure TinyMCE folder is not world writable (775 or 555 instead of 777)
In 1.6.6 I have no problem with TinyMCE on my XAMPP setup, and my main linux server. However, on Hostgator shared hosting with Linux and PHP 5.2.9, I've upgraded and done all of the above, but still have the checkbox with no icons problem for textareas in the admin for pages, news, etc.
If I find an answer to this I'll post it here.