Thanks for the ideas guys.
I did a thorough system virus scan but it came up negative.
I then tried scannow - but this had no affect so I did a repair of XP as detailed by JoeC. Again it has not cured the problems and System Restore still cannot be accessed. It's too early to tell whether the auto download or system freezes have been cured - but since the Restore feature isn't fixed then the indications are that the other problems probably remain.
It's looking like I need a full delete of Windows and a reinstall - for which I need the requested step-by-step guide.