Without a backup of your vital data, you are faced with some tough choices.
No one wants to hear the 'holier than thou' lecture on that, so let's just
say we're past that.
First, of course, you want to be sure it's not just bad floppies. After
that, it's finding a way to read the drive.
1) Install the drive to another system, and 'take ownership' of the data.
2) buy a standard xp setup disk, and try a setup without any fancy hardware,
just to install to a new folder, and boot to take ownership/copy data.
3) assuming you have all the data you can get, do the provided wipe
out/recovery.
HOW TO Take Ownership of a File or Folder in Windows XP:
http://support.microsoft.com/default.aspx?scid=KB;EN-US;Q308421
I think you are seeing what is a fairly common problem since sp2. Adware or
virus has damaged the password file, and without that, you can't even get to
recovery console.
There is another system available online, called BartPE. It's a cd of the
"preinstall environment' used by some OEM's to prepare sysprep images of
systems. I think it has some bugs, but it might be something that could
serve for you in this case. I always recommend doing a restore point
beforehand on the system used to create the boot cd, and restore that system
after cd creation. (there are relics of the creation process I don't like)
(BartPE) bootable live windows CD-DVD:
http://www.nu2.nu/pebuilder/