i tried the "install over the top" suggestion to fix this problem, but it didn't work.
i will try the other suggestion to copy over the userinit.exe file and rename it wsaupdater.exe
to boot from cd, make sure the bios (usually press F2 or DEL key at bootup to get into the bios, then go to boot options) is set to boot from cdrom. put in the windows xp cd and reboot the computer, should ask you to boot from cd. once the cd boots you can either choose install or repair option. install will either do a fresh install or install over the top of the current xp configuration. repair option will drop you into a dos like console, but you may need to know the administrator password. if you dont have it you will have to "blank" the password using offline password changer mentioned previously (but you must be very careful or you will screw it up worse).
thank you for the suggestions, i will try the above and report back. 8)