First Thanks for the componant and to keep it free.
I have the same issue in 1.5.3 Stable.
In use the official french lang-pack (downloadeable at http://joomlacode.org/gf/download/frsrelease/7416/25774/fr-FR.site.1.5.3
Some one other user suggest to create a folder name "language" at the root of the server and it's work but it's not a solution for a hosted site just for a local site.
Nota 1: i have installed only the componant of googlesearch and not the module;
Nota 2: i use sh404sef and if i deactivate the plugin sh404 sef then no problem occurs.
I have also a warning of sh404sef that says :
Warning : Invalid argument supplied for forearch() in
/var/www/joomla/administrator/components/com_sh404sef/sh404sef.class.php on line 2186
The error JFolder::folder seems to comes from this php files of the sh404sef componant because just before the foreach in warning their is the affectation of $path with the JFolder::folder class.
An incompatibility between GoogleSearch and sh404SEF componants ?