For all those with the same problem...as I did I found out what the problems is:
MICROSOFT!!!!!!!!!!!!
Windows XP Service Pack 3 has caused this problem!
If you have this problem restart your machine and before XP boots in press F8. Then go to "Last Known Good Configuration", select Windows XP (Home or Professional depending on OS yo have) and then your PC will restart and hopefully allow you to log back in.
However once you are in it will try and reinstall the same Service Pack....DON'T LET IT DO IT other wise you will have the same problem.
Good luck!!!!
Further advice----
If your system won't let you login there is only one other thing to do....reinstall the OS.
This can be done without overwriting any of the files you have personally saved.
Restart your machine with your XP OS disc in the CD drive and make sure that it reads this before reading the HDD (hard-drive).
Once you ask the CD to load XP again let don't choose "fresh copy" choose "repair". This will remove the "nasty"
files that Service Pack 3 installed and then reinstall the original files you need.