It's not clear exactly what you can and can't do, but try reinstalling Service Pack 3 by downloading the full SP3 installer from the link below.. It's a large file so you'll need a fast broadband connection to perform the download with. (I would probably use a separate, clean computer, then download the full file, then copy it to a CD. Once that's done, transfer it to the problem machine and run SP3 to reinstall and repair the files that are repairable by the SP3 installer.)

http://www.microsoft.com/downloads/details.aspx?FamilyId=5B33B5A8-5E76-401F-BE08-1E1555D4F3D4&displaylang=en

If that doesn't work, then yep, running the Windows repair or format and reinstall everything is probably your best bet because they are both run using the XP bootdisc type of startup.

Hope this helps.

Grif