I have the EXACT same problem and I am extremely frustrated about it.
It worked fine with SP2 but I was having some problems with other programs fo after about a month of use I decided to uninstall SP2 and then I come to find out that Firefox and IE no longer work.
I tried repairing SP1 by reinstalling Windows by doing the repair from the CD but that did not work. Firefox shows a blank page with source:
<!DOCTYPE html PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN"><html><head><title></title></head><body></body></html>
and Internet Explorer either shows 'Page cannot be displayed' or crashes.
If I go into My Computer or go to the C: drive or any other folder and then type a URL in the address bar while in a folder, it starts working but it's very annoying and new pop up windows crash.
Please help, I'll REALLY appreciate it.
Thanks so much in advance :)