I am sure this is not the tweak a forum member mentioned, but did not post his tweak, however this should do the same thing and appears to be less effort.
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After following this tutorial, "Libraries" feature will be disabled in Windows 7 and its icon will also be removed from Explorer and Start menu.
You just need to run a small Registry script to disable it. Download following ZIP file, extract it and run the "Disable Libraries in Windows 7.REG" file:
Download Registry Script (http://www.multiupload.com/ASLY17E3Z8)
After running the .REG file, log off or restart your system and you'll no longer see Libraries icon in Windows Explorer:
(http://i56.tinypic.com/fw179e.jpg)
If you don't want to disable complete "Libraries" feature but only want to remove its icon from Explorer, then run "Only Remove Libraries Icon from Windows 7 Explorer.reg" file.
PS: There is also a restore script available in case you want to restore Libraries.