The \recycler directory has "hidden" and "system" attributes set, so you don't see it in Windows unless you've selected to "Show hidden files and folders" and unselected "Hide protected operating system files" in Windows Explorer's folder options (it's in Tools menu).

Once you see the recycler directory, try this:

Rename it to something else, like recycler2. Then delete a file (create an empty text document or something, for example). Explorer should create a new \recycler directory. Then delete recycler2. Maybe this helps.