[norsang]

My two year old lap top was running fine until I got infected through a storage dongle. Every time I turn my comp on the following notice comes up:
Windows cannot find 'C:\WINDOWS\winlogon.exe.' Make sure you typed the name correctly, and then try again. To search for a file, Click the Start button, and then click Search.

I can go past that warning but many of the programs like Thunderbird and internet browers both FF and IE freezes up. Also I keep getting warning that my computer's virtual memory has run out of space.
Worse, when I shut down my laptop, the icons disappear but the wallpaper remains and just remains that way until I physically turn off the machine.
I have run Hijack this and the log is below:
Logfile of Trend Micro HijackThis v2.0.2
Scan saved at 2:05:37 PM, on 9/1/2009
Platform: Windows XP SP3 (WinNT 5.01.2600)
MSIE: Internet Explorer v8.00 (8.00.6001.18702)
Boot mode: Normal

Running processes:
C:\WINDOWS\System32\smss.exe
C:\WINDOWS\system32\winlogon.exe
C:\WINDOWS\system32\services.exe
C:\WINDOWS\system32\lsass.exe
C:\WINDOWS\system32\svchost.exe
C:\WINDOWS\System32\svchost.exe
C:\WINDOWS\System32\WLTRYSVC.EXE
C:\WINDOWS\System32\bcmwltry.exe
C:\Program Files\Lavasoft\Ad-Aware\aawservice.exe
C:\WINDOWS\Explorer.exe
C:\WINDOWS\system32\spoolsv.exe
C:\xampp\apache\bin\httpd.exe
C:\Program Files\Bonjour\mDNSResponder.exe
C:\Program Files\Java\jre6\bin\jqs.exe
C:\Program Files\Common Files\Microsoft Shared\VS7DEBUG\MDM.EXE
C:\xampp\mysql\bin\mysqld.exe
C:\Program Files\Dell\QuickSet\NICCONFIGSVC.exe
C:\Program Files\Eset\nod32krn.exe
C:\WINDOWS\system32\svchost.exe
C:\xampp\apache\bin\httpd.exe
C:\Program Files\Apoint\Apoint.exe
C:\WINDOWS\system32\WLTRAY.exe
C:\WINDOWS\system32\igfxtray.exe
C:\WINDOWS\system32\hkcmd.exe
C:\WINDOWS\system32\igfxpers.exe
C:\Program Files\Eset\nod32kui.exe
C:\WINDOWS\system32\igfxsrvc.exe
C:\Program Files\Apoint\HidFind.exe
C:\Program Files\Apoint\Apntex.exe
C:\Program Files\Java\jre6\bin\jusched.exe
C:\WINDOWS\system32\ctfmon.exe
C:\Documents and Settings\Dell\Local Settings\Application Data\Google\Update\GoogleUpdate.exe
C:\Program Files\Adobe\Acrobat 6.0\Distillr\acrotray.exe
C:\WINDOWS\system32\wuauclt.exe
C:\Program Files\ZTE CDMA1X MODEM\Bin\PcmciaApp.exe
C:\Program Files\Trend Micro\HijackThis\HijackThis.exe

R0 - HKCU\Software\Microsoft\Internet Explorer\Main,Start Page = http://go.microsoft.com/fwlink/?LinkId=69157
R1 - HKLM\Software\Microsoft\Internet Explorer\Main,Default_Page_URL = http://go.microsoft.com/fwlink/?LinkId=69157
R1 - HKLM\Software\Microsoft\Internet Explorer\Main,Default_Search_URL = http://go.microsoft.com/fwlink/?LinkId=54896
R1 - HKLM\Software\Microsoft\Internet Explorer\Main,Search Page = http://go.microsoft.com/fwlink/?LinkId=54896
R0 - HKLM\Software\Microsoft\Internet Explorer\Main,Start Page = http://go.microsoft.com/fwlink/?LinkId=69157
F2 - REG:system.ini: Shell=Explorer.exe C:\WINDOWS\winlogon.exe
O2 - BHO: Adobe PDF Reader Link Helper - {06849E9F-C8D7-4D59-B87D-784B7D6BE0B3} - C:\Program Files\Common Files\Adobe\Acrobat\ActiveX\AcroIEHelper.dll
O2 - BHO: Skype add-on (mastermind) - {22BF413B-C6D2-4d91-82A9-A0F997BA588C} - C:\Program Files\Skype\Toolbars\Internet Explorer\SkypeIEPlugin.dll
O2 - BHO: AcroIEToolbarHelper Class - {AE7CD045-E861-484f-8273-0445EE161910} - C:\Program Files\Adobe\Acrobat 6.0\Acrobat\AcroIEFavClient.dll
O2 - BHO: Java(tm) Plug-In 2 SSV Helper - {DBC80044-A445-435b-BC74-9C25C1C588A9} - C:\Program Files\Java\jre6\bin\jp2ssv.dll
O2 - BHO: JQSIEStartDetectorImpl - {E7E6F031-17CE-4C07-BC86-EABFE594F69C} - C:\Program Files\Java\jre6\lib\deploy\jqs\ie\jqs_plugin.dll
O3 - Toolbar: Adobe PDF - {47833539-D0C5-4125-9FA8-0819E2EAAC93} - C:\Program Files\Adobe\Acrobat 6.0\Acrobat\AcroIEFavClient.dll
O4 - HKLM\..\Run: [Apoint] C:\Program Files\Apoint\Apoint.exe
O4 - HKLM\..\Run: [Broadcom Wireless Manager UI] C:\WINDOWS\system32\WLTRAY.exe
O4 - HKLM\..\Run: [igfxtray] C:\WINDOWS\system32\igfxtray.exe
O4 - HKLM\..\Run: [igfxhkcmd] C:\WINDOWS\system32\hkcmd.exe
O4 - HKLM\..\Run: [igfxpers] C:\WINDOWS\system32\igfxpers.exe
O4 - HKLM\..\Run: [nod32kui] "C:\Program Files\Eset\nod32kui.exe" /WAITSERVICE
O4 - HKLM\..\Run: [Adobe Reader Speed Launcher] "C:\Program Files\Adobe\Reader 8.0\Reader\Reader_sl.exe"
O4 - HKLM\..\Run: [SunJavaUpdateSched] "C:\Program Files\Java\jre6\bin\jusched.exe"
O4 - HKLM\..\Run: [KernelFaultCheck] %systemroot%\system32\dumprep 0 -k
O4 - HKLM\..\Run: [QuickTime Task] "C:\Program Files\QuickTime\qttask.exe" -atboottime
O4 - HKCU\..\Run: [ctfmon.exe] C:\WINDOWS\system32\ctfmon.exe
O4 - HKCU\..\Run: [Google Update] "C:\Documents and Settings\Dell\Local Settings\Application Data\Google\Update\GoogleUpdate.exe" /c
O4 - HKUS\S-1-5-19\..\RunOnce: [ShowDeskFix] regsvr32 /s /n /i:u shell32 (User 'LOCAL SERVICE')
O4 - HKUS\S-1-5-20\..\RunOnce: [ShowDeskFix] regsvr32 /s /n /i:u shell32 (User 'NETWORK SERVICE')
O4 - HKUS\S-1-5-18\..\RunOnce: [ShowDeskFix] regsvr32 /s /n /i:u shell32 (User 'SYSTEM')
O4 - HKUS\.DEFAULT\..\RunOnce: [ShowDeskFix] regsvr32 /s /n /i:u shell32 (User 'Default user')
O4 - Global Startup: Acrobat Assistant.lnk = C:\Program Files\Adobe\Acrobat 6.0\Distillr\acrotray.exe
O4 - Global Startup: Adobe Gamma Loader.lnk = C:\Program Files\Common Files\Adobe\Calibration\Adobe Gamma Loader.exe
O8 - Extra context menu item: E&xport to Microsoft Excel - res://C:\PROGRA~1\MICROS~3\OFFICE11\EXCEL.EXE/3000
O9 - Extra button: Skype - {77BF5300-1474-4EC7-9980-D32B190E9B07} - C:\Program Files\Skype\Toolbars\Internet Explorer\SkypeIEPlugin.dll
O9 - Extra button: Research - {92780B25-18CC-41C8-B9BE-3C9C571A8263} - C:\PROGRA~1\MICROS~3\OFFICE11\REFIEBAR.DLL
O9 - Extra button: (no name) - {e2e2dd38-d088-4134-82b7-f2ba38496583} - C:\WINDOWS\Network Diagnostic\xpnetdiag.exe
O9 - Extra 'Tools' menuitem: @xpsp3res.dll,-20001 - {e2e2dd38-d088-4134-82b7-f2ba38496583} - C:\WINDOWS\Network Diagnostic\xpnetdiag.exe
O9 - Extra button: Messenger - {FB5F1910-F110-11d2-BB9E-00C04F795683} - C:\Program Files\Messenger\msmsgs.exe
O9 - Extra 'Tools' menuitem: Windows Messenger - {FB5F1910-F110-11d2-BB9E-00C04F795683} - C:\Program Files\Messenger\msmsgs.exe
O16 - DPF: {5ED80217-570B-4DA9-BF44-BE107C0EC166} (Windows Live Safety Center Base Module) - http://cdn.scan.onecare.live.com/res...lscbase370.cab
O17 - HKLM\System\CCS\Services\Tcpip\..\{F3E04B07-7E9C-4EB6-9A57-FFF878E178B9}: NameServer = 202.138.103.100 97.253.25.9
O18 - Protocol: skype4com - {FFC8B962-9B40-4DFF-9458-1830C7DD7F5D} - C:\PROGRA~1\COMMON~1\Skype\SKYPE4~1.DLL
O23 - Service: Lavasoft Ad-Aware Service (aawservice) - Lavasoft - C:\Program Files\Lavasoft\Ad-Aware\aawservice.exe
O23 - Service: Apache2.2 - Apache Software Foundation - C:\xampp\apache\bin\httpd.exe
O23 - Service: Ati HotKey Poller - ATI Technologies Inc. - C:\WINDOWS\system32\Ati2evxx.exe
O23 - Service: Bonjour Service - Apple Inc. - C:\Program Files\Bonjour\mDNSResponder.exe
O23 - Service: FileZilla Server FTP server (FileZilla Server) - FileZilla Project - c:\xampp\FileZillaFTP\FileZillaServer.exe
O23 - Service: Java Quick Starter (JavaQuickStarterService) - Sun Microsystems, Inc. - C:\Program Files\Java\jre6\bin\jqs.exe
O23 - Service: mysql - Unknown owner - C:\xampp\mysql\bin\mysqld.exe
O23 - Service: NICCONFIGSVC - Dell Inc. - C:\Program Files\Dell\QuickSet\NICCONFIGSVC.exe
O23 - Service: NOD32 Kernel Service (NOD32krn) - Eset - C:\Program Files\Eset\nod32krn.exe
O23 - Service: Dell Wireless WLAN Tray Service (wltrysvc) - Unknown owner - C:\WINDOWS\System32\WLTRYSVC.EXE

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End of file - 6961 bytes

Thanks for the help in advance.