I have a suggestion or two left in me..
I would suggest - since you are going to be redoing your system -
using Ghost or some other imaging software and another drive
(external drive maybe.. Network drive maybe..) to GHOST your entire
system... then..
Before redoing things from scratch - get a disk diagnostics
diskette/cd image from the hard drive manufacturers web site and
test it - then wipe it (write zeros to it, low-level format -
whatever options they give you to obliterate it at a lower level
than a format would) and apply the image to your machine. It will
overwrite (but in a very orderly way) everything there - and perhaps
resolve your issue.
Secondly - you are guaranteed a full backup (without worry of loss)
of everything on your system this way.
Something else to consider is customizing an installation CD/DVD
before you begin.
http://unattended.msfn.org is a great start to start with to do
this. You could make a Windows XP CD that installs with SP2 and all
current patches, not to mention you could add whatever applications
you want to the CD to be automatically installed - so you have less
work to do in the future.