Can you run virus scans from normal mode? If your computer is locking up, it could be both software related, or hardware.
If its having problems entering safe mode, you may have something besides that smitfraud to worry about 
Get your XP CD, and in normal mode go to Start -> Run -> type SFC /scannow and press Enter to start it. It will ask for the XP CD.
Do you have a legit copy of windows? Corp? XP Home, XP Pro? What service pack?
If you want to drop the computer off at my house, I can also take a look at it for ya. I’ll pull the drive and manually remove the smitfraud stuff in a second box, as well as get it running normally for ya. I’ll also check to see if you have any hardware issues, and I’ll blow all of the dust out with a 2HP air compressor to keep her running the temperature she should be.
PM me if you want.