Hey Alex, I think we need to review memory again here, and just reread some of this post to get back up to speed with this problem, and just realised something silly.

When I asked you to do memtest earlier in the thread, you said (in post #38), that it said "press F3 to quit", which I didn't remember memtest doing, but I didn't question it. Normally memtest will carry on going, and at the end of the test you will see the results. Two posts earlier, you posted a screenshot which shows the same message "press F3 to quit". I really hope you don't think this is part of memtest when it shows "Windows XP Professional Setup"? I have no idea how you got from memtest to Windows XP setup, but I don't think that memtest was run properly to start with. Memtest looks like this, did you see this screen when doing your test earlier?:



Everything you described from the start points to memory as being the most likely culprit, and the last two post point to disk corruption again.