Final Update
I had seen the memory fix at another site ran memtest for hours and found no problems. placed the memory in a working computer seemed ok.
Tried creating a windows recovery cd with slipstreamed sp2 and was unable to repair the damaged files. Or rather the files would be replaced and the same error would occur.
Eventually was able to change file permission settings and access my files through the 2nd pc. Backed up what I needed and decided to scrap the harddrive and start fresh.
Thank you all for your help, hopefully others with a similar probelm will come to a better resolution.