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User accounts problem in Safe Mode

A sister-in-law using a several year old Dell pc with Windows XP suspects she has a worm, possibly NETSKY.Q. She has a lot of family pictures that are not backed up in the computer and does not want to lose thern.

Now she has done something to her computer in the process of scanning with AVG Free and Spy Bot, trying to disable RESTORE, and run scans in SAFE mode. Now she can not log on to any user names even when booting in Safe Mode. When you click on an Administrator account, there is a brief flash (possibly the User's wallpaper) and then it says "Logging off" and goes back to the User Accounts screen.

We can't even get into Windows to try to deal with the worm issue. I am getting mixed opinions as to whether to do a Windows Repair install or not to attempt that because she will lose the pics in the process. Figured I see if any of you might be able to offer some help.

Any thoughts?
Thanks
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