Sick system

My client's laptop is going really really slowly.
I've done:

AVG - clean
spyware - clean
malware - clean
hijack this - clean
CCleaner and Defrag done

I did a Memtest - nothing wrong there.
I performed storage tests with TuffTest - interestly, the Internal Controller Diagnostic Test failed, but the Seek Test and the Surface Analysis passed!!

I downloaded the manufacturer's disk test, and that passed. Then I ran SMART with the Stellar Smart Early Disk Warning System - the Fitness level on every test was 100%, except that the Seek Error rate is 32% and the Write Error Count is 22%! These don't look right.

All the processes, memory and CPU usage look fine,

51C - CPU Temp, 38C - HDD

Nothing out of the ordinary in the Event Log either.
BIOS is latest BIOS

Systems specs:

Fujitsu Siemens Amilo Pro V7010
Fujitsu PL501 motherboard
BIOS: Fujitsu Siemens / Phoenix 1.10 28/12/04

This is strange:

BelArc reports it has got 1024MB memory in slot 1, and then directly under Installed Memory, it says there's only 480MB!

FUJITSU MHT2040AT 40GB HDD
Windows XP SP3

My mate tested the disk on a Linux system and he said it was fine.

Whats happening?!

have you got a stick of faulty ram because with 1 stick of 512 them - 32 for graphics makes 480

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Latest news:

I downloaded Process Explorer; screenshot attached' I have shut down MSN, which was hogging a lot of system memory and CPU.
(I think there is a rogue process running)
I've also downloaded Security Task Manager, screenshot attached, and I also downloaded Hijack This!
I don't like that GrooveModule entry in the STM

Here are the attachments

Attached Images

	msconfig - services screenshot - top.bmp (27.1 KB, 19 views)
	security tm.bmp (56.3 KB, 19 views)
	process explorer.bmp (44.6 KB, 19 views)

Attached Files

hijackthis - Nicky Harrop 151208.txt (7.1 KB, 4 views)

your hijack report can you please put it in the spy ware thread

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Have you tried reinstalling your windows xp?
I would also suggest using Knoppix and observe if it will show same slow down, otherwise its your OS

I haven't tried reinstalling XP yet.

I can't find a 'plain English' guide (yes I've tried Wiki) on how to burn the iso of Knoppix yo CD (without extracting the files?)

This might help:

Burn Knoppix iso to CD? - Knoppix.net

Not only with the burning of your CD, but general help with Knoppix as well.

I hear that Deepburner is a good burner program for Windows. I use K3B, so I couldn't say personally...

DeepBurner