win XP Auto-boots in safe mode, very slow

Hi there, thanks to those of you who look into this for me and help me figure this out. First off, the other day I was doing some regular internet searching on google. All of a sudden my avast shield popped up and said that there was a virus detected and it was autodisconnecting the connection. Right after that I got the windows security center popping up and saying that the system was infected and of course it wouldn't allow me to do anything. I went to run/msconfig and it said it couldn't be done as it has been infected. Would do this to anything I would do. Now, I have fought this before on various other machines and thought that I was pretty efficient at fixing this, but when I powered down the system and rebooted into safe mode it hung at the driver for the agpCPQ.sys file. Would hang here for all 3 versions of safe mode. I know that this is usually due to a corrupt video driver which had to have been corrupted somehow on the shutdown/restart process. I pulled the HDD out of the machine, hooked it up as the secondary on my other computer, ran an avast virus scanner which only found 1 infected file, a spybot scan which pulled up 1 problem, and then ran a disk cleaner on it. I put the hard disc back into the original machine and tried to boot in safe mode but it would hang as before. When i reboot the system normally, or reboot to the last known good configuration it hangs after the windows xp logo for about 8~ minutes then shows it is booting in safe mode. It takes a very long time before it pulls up the login screen, and once i log into the administrator account it takes 10~minutes before it gets to a point that I can move the mouse and look around. Any ideas/help are appreciated.

I managed to get a hold of a windows xp home edition OS cd and tried to do a repair. After it rewrote the system files it restarted, booted into safe mode automatically and pops up a dialog box that says, "setup cannot continue in safe mode. Ok to reboot?" i click yes and the system reboots itself back into safe mode and the process repeats itself. I tried to reconfigure the boot by initiating a repair, and at the c:/windows screen typing bootcfg /rebuild. It scans the system for the windows operating systems installed. I hit yes when it asked if properly identified the windows OS installed. When it asked for the load identifier I typed Windows XP Home Edition, and when it asked for OS Load Options I typed /fastdetect. It then pretty much installed a new windows operating system asking for the cd key which I entered but did not activate that code. I reattempted the above steps typing the exact name of the load identifier to match that of the one I'm having problems with and it just created yet another version it's trying to install.