Have you tried closing the system restore,as it may be hiding there, most virus checkers do not check this area.
If you have a XP CD put it in the drive, go to RUN and enter sfc /scannow, this will check all your system files and restore to the original location.
Restart in Safe Mode, Run Defrag
While in safe mode run your virus program.
If that does not cure it, you have a major problem.