I am developing an application called WeatherBar. Its main functionality is based on its interaction with the Windows 7 taskbar — it changes the icon depending on the weathe
If you want to do this programatically, I would start by looking at the Portable Executable file format (Wikipedia entry). The resources section (.rsrc, see section 6.9) should contain the icon. Using this information, you can write a tool to modify the icon.
If you just want to quickly change an icon in an existing file, you might be able to hack it up in the Visual Studio resource editor. I tested this with a file by deleting the old icon and adding a new one. The .exe icon changed in Explorer to the new icon, and the new icon appeared on the Start menu when I dragged it there.
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Yes, I agree that using UpdateResource is a good approach. Here is an example I found of using C++ functions to do so, and a P/Invoke signature for UpdateResource and FindResource.