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There has been a recent an extensive topic on this very thing RealSpy and xoftspy http://forum.avast.com/index.php?topic=24181.0, it is almost certainly a false positive. The upshot of the topic was get rid of xoftspy chequered with its previous past.

The removal if this is a false positive as we suspect could have removed an essential file causing these issues. If xoft has the option of restoring a previous deletion you should first try this and see if it resolves the problem.

You also didn’t mention what xoft said is the infected file name, where was it found e.g. (C:\windows\system32\infected-file-name.xxx) ?