diff --git a/installer/PowerToysSetupVNext/Core.wxs b/installer/PowerToysSetupVNext/Core.wxs
index a9cf083512..aaf9bb5550 100644
--- a/installer/PowerToysSetupVNext/Core.wxs
+++ b/installer/PowerToysSetupVNext/Core.wxs
@@ -61,6 +61,16 @@
         </RegistryKey>
         <File Source="$(var.RepoDir)\Notice.md" Id="Notice.md" />
       </Component>
+      <Directory Id="SvgsFolder" Name="svgs">
+        <Component Id="svgs_icons" Guid="A9B7C5D3-E1F2-4A6B-8C9D-0E1F2A3B4C5D" Bitness="always64">
+          <RegistryKey Root="$(var.RegistryScope)" Key="Software\Classes\powertoys\components">
+            <RegistryValue Type="string" Name="svgs_icons" Value="" KeyPath="yes" />
+          </RegistryKey>
+          <File Id="icon.ico" Source="$(var.BinDir)svgs\icon.ico" />
+          <File Id="PowerToysWhite.ico" Source="$(var.BinDir)svgs\PowerToysWhite.ico" />
+          <File Id="PowerToysDark.ico" Source="$(var.BinDir)svgs\PowerToysDark.ico" />
+        </Component>
+      </Directory>
     </DirectoryRef>
 
     <?if $(var.PerUser) = "true" ?>
@@ -112,6 +122,7 @@
         <RemoveFolder Id="RemoveBaseApplicationsAssetsFolder" Directory="BaseApplicationsAssetsFolder" On="uninstall" />
         <RemoveFolder Id="RemoveWinUI3AppsInstallFolder" Directory="WinUI3AppsInstallFolder" On="uninstall" />
         <RemoveFolder Id="RemoveWinUI3AppsAssetsFolder" Directory="WinUI3AppsAssetsFolder" On="uninstall" />
+        <RemoveFolder Id="RemoveSvgsFolder" Directory="SvgsFolder" On="uninstall" />
         <RemoveFolder Id="RemoveINSTALLFOLDER" Directory="INSTALLFOLDER" On="uninstall" />
       </Component>
       <ComponentRef Id="powertoys_exe" />
@@ -120,6 +131,7 @@
       <ComponentRef Id="powertoys_toast_clsid" />
       <ComponentRef Id="License_rtf" />
       <ComponentRef Id="Notice_md" />
+      <ComponentRef Id="svgs_icons" />
       <ComponentRef Id="DesktopShortcut" />
       <?if $(var.PerUser) = "true" ?>
       <ComponentRef Id="powertoys_env_path_user" />
diff --git a/src/runner/general_settings.cpp b/src/runner/general_settings.cpp
index 5024e39753..4deb36ec17 100644
--- a/src/runner/general_settings.cpp
+++ b/src/runner/general_settings.cpp
@@ -367,11 +367,21 @@ void apply_general_settings(const json::JsonObject& general_configs, bool save)
     if (json::has(general_configs, L"show_theme_adaptive_tray_icon", json::JsonValueType::Boolean))
     {
         bool new_theme_adaptive = general_configs.GetNamedBoolean(L"show_theme_adaptive_tray_icon");
+        Logger::info(L"apply_general_settings: show_theme_adaptive_tray_icon current={}, new={}",
+                     show_theme_adaptive_tray_icon, new_theme_adaptive);
         if (show_theme_adaptive_tray_icon != new_theme_adaptive)
         {
             show_theme_adaptive_tray_icon = new_theme_adaptive;
             set_tray_icon_theme_adaptive(show_theme_adaptive_tray_icon);
         }
+        else
+        {
+            Logger::info(L"apply_general_settings: show_theme_adaptive_tray_icon unchanged, skipping update");
+        }
+    }
+    else
+    {
+        Logger::warn(L"apply_general_settings: show_theme_adaptive_tray_icon not found in config");
     }
 
     if (json::has(general_configs, L"ignored_conflict_properties", json::JsonValueType::Object))
diff --git a/src/runner/tray_icon.cpp b/src/runner/tray_icon.cpp
index 9cff0c36ff..633c2c1b42 100644
--- a/src/runner/tray_icon.cpp
+++ b/src/runner/tray_icon.cpp
@@ -273,12 +273,19 @@ static HICON get_icon(Theme theme)
 {
     std::wstring icon_path = get_module_folderpath();
     icon_path += theme == Theme::Dark ? L"\\svgs\\PowerToysWhite.ico" : L"\\svgs\\PowerToysDark.ico";
-    return static_cast<HICON>(LoadImage(NULL,
+    Logger::trace(L"get_icon: Loading icon from path: {}", icon_path);
+
+    HICON icon = static_cast<HICON>(LoadImage(NULL,
                                         icon_path.c_str(),
                                         IMAGE_ICON,
                                         0,
                                         0,
                                         LR_LOADFROMFILE | LR_DEFAULTSIZE | LR_SHARED));
+    if (!icon)
+    {
+        Logger::warn(L"get_icon: Failed to load icon from {}, error: {}", icon_path, GetLastError());
+    }
+    return icon;
 }
 
 
@@ -374,13 +381,45 @@ void set_tray_icon_visible(bool shouldIconBeVisible)
 
 void set_tray_icon_theme_adaptive(bool theme_adaptive)
 {
-    theme_adaptive_enabled = theme_adaptive;
+    Logger::info(L"set_tray_icon_theme_adaptive: Called with theme_adaptive={}, current theme_adaptive_enabled={}",
+                 theme_adaptive, theme_adaptive_enabled);
+
     auto h_instance = reinterpret_cast<HINSTANCE>(&__ImageBase);
-    HICON const icon = theme_adaptive ? get_icon(theme_listener.AppTheme) : LoadIcon(h_instance, MAKEINTRESOURCE(APPICON));
+    HICON icon = nullptr;
+
+    if (theme_adaptive)
+    {
+        icon = get_icon(theme_listener.AppTheme);
+        if (!icon)
+        {
+            Logger::warn(L"set_tray_icon_theme_adaptive: Failed to load theme adaptive icon, falling back to default");
+        }
+    }
+
+    // If not requesting adaptive icon, or if adaptive icon failed to load, use default icon
+    if (!icon)
+    {
+        icon = LoadIcon(h_instance, MAKEINTRESOURCE(APPICON));
+        if (theme_adaptive && icon)
+        {
+            // We requested adaptive but had to fall back, so update the flag
+            theme_adaptive = false;
+            Logger::info(L"set_tray_icon_theme_adaptive: Using default icon as fallback");
+        }
+    }
+
+    theme_adaptive_enabled = theme_adaptive;
+
     if (icon)
     {
         tray_icon_data.hIcon = icon;
-        Shell_NotifyIcon(NIM_MODIFY, &tray_icon_data);
+        BOOL result = Shell_NotifyIcon(NIM_MODIFY, &tray_icon_data);
+        Logger::info(L"set_tray_icon_theme_adaptive: Icon updated, theme_adaptive_enabled={}, Shell_NotifyIcon result={}",
+                     theme_adaptive_enabled, result);
+    }
+    else
+    {
+        Logger::error(L"set_tray_icon_theme_adaptive: Failed to load any icon");
     }
 }