IE Hijack virus survived a full hard drive reformat

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I spent the best part of the weekend trying to fix my PC after Internet Explorer was hijacked whilst I tried to download some DVD ripping software - be careful guys. Having tried loads of antivirus / spyware removal software to no avail, and having noticed that this evil virus had badly messed with the registry of my PC, I decided that the only thing to do was to reformat the hard drive.

First I found that the instructions for reformatting my XP hard drive would not work. I think the virus was preventing me from formatting it! I got down to the "Press Y to format" bit, pressed Y and got a circular prompt.

I eventually found a way to do it, having tweeked BIOS and booting XP from CD instrad of hard drive. I managed to fully reformat the hard drive - all files gone. The first thing I installed was my internet connection. I had been connected for about five seconds before a pop-up appeared, telling me that my computer was infected. I had not even opened Internet Explorer yet.

Has anyone ever seen this before? A virus surviving a hard drive formatting?? Has this thing messed with the magnetic polarity of the particles of my physical hard drive??! Is there any way I will ever be able to shift this? It is pure evil....any ideas would be much appreciated. Thanks in avcance.
 
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