I got the idea from VirtualPlastic.net and combined it with CLSID Folders.
The zip file includes 4 CLSID Folders; My Computer, Control Panel, All Programs & Start Menu.
Copy these folders to any location you want and create a new Toolbar (right click on the Taskbar, select Toolbars -> New Toolbar...).
Point the new Toolbar to one of the CLSID Folders and drag the Toolbar to the Systray or another Toolbar as far as you can, it will leave you with only the double arrow.
The result is a Toolbar with expanding menus that's taking up nearly no space.
When you see the CLSID Extensions, merge NeverShowExt.reg & restart Explorer or your Computer.
The reg file only hides the extensions from the folders in this zip file, not from all files.
» TaskbarMenus.zip (4KB)
[/Herby]