I did it by doing a repair install with the winxp pro disk. I uninstalled service pack 3 then did the repair install. Service pack 3 was reinstalled and everything with internet explorer is working fine.
I restored the C drive using a Shadow Protect restore file. I've used this file before with no problems. This time IE7 doesn't display my home page, excite.com properly. Firefox and chrome show it properly. I normally wouldn't be concerned as I only use IE for windows updates. However updates isn't working either. It shows checking for active x controls but nothing else happens and it shows done on the status bar. Other websites seem to work alright. This is with winxp service pack 3.