Could someone help me with my XP problem?

Ask some people you know if you can borrow an OEM Windows XP Install Disc (not an upgrade disc from Windows 95).

Crap, that doesn’t sound good. When I’ve had an intractable problem with my windows machine, I bit the bullet and called Microsoft. I had to pay for the support, but it was mostly worth it. In only one instance did I have to take my computer to a physical location to have it fixed. In all others they were able to either walk me through it, do it remotely, or send me the disk I needed.

I Googled this for about an hour and it seems to be a pretty common problem. But it looks like the only fix that is not a insane pain in the ass is to have the CD. It sounds like any retail copy of XP should do the trick. It would put a ad on Craigslist to see if anyone has a spare copy. There are probably thousands of them not being used. I have a spare one sitting in a box somewhere and I’m sure someone in Sacramento has one too. You should be able to restore from that and the activation crap won’t matter since you are just replacing a file.

Can you boot up into safe mode?

system restore should help just as easily,

oh you must boot into safe mode by hold down the f8 at the beginning of start up just when the window logo shows.

Well, I’ve borrowed someone’s Windows XP setup disc. But after going through all the repair setup it cannot create the folder: \WINDOWS\system32\spool
and setup can’t continue until that folder is created.
Now what?

Thanks to everyone who tried to help me. I ended up calling a professional. Turns out my hard drive was pretty f***ed up and was going out. Most things on it were able to be saved and put on another drive.
Again, thanks, all!