Well… if your system is deeply infected, I really think that reinstalling will be easier and safer.
Anyway, you can try overinstallation that can solve the problem and you won’t lose your programs, settings, data, files, etc.
Just choose ‘Repair’ installation of Windows and install ‘over’ the old installation.
http://support.microsoft.com/default.aspx?scid=kb;EN-US;315341
http://support.microsoft.com/default.aspx?scid=kb;en-us;Q314058
http://www.webtree.ca/windowsxp/repair_xp.htm