Dear Ladynurse,
Do you have any other web browser installed on your computer? If not,then download Mozilla Firefox3 from this location:
http://www.mozilla.com/en-US/firefox/ .
After installing FF3, see if you can open new web sites, links etc, with firefox. If you can, then you have a problem with IE! I have personally stopped using Internet Explorer since quite sometime, but use it to check and install Microsoft updates.
Have you downloaded and installed SP2 and SP3? If you want to check whether these service packs are installed, go to Add/Remove (By opening Control panel) and scroll down to see if these are there. If not found, then Immediately install service pack2 from here:
http://www.microsoft.com/windowsxp/using/security/expert/russel_installsp2.mspx