I don't know...I cannot think of anything that would create that kind of confusion to XP (where it reflects errors related to Server 2003). File corruption is my catchall "blameguy" for some things
Maybe a corrupt profile (WAG), but I've not had any experience with such.
But, I don't claim to know very much and I would just try the obvious steps which I have already stated.
If a clean install produced the same error/situation...I would have to punt and start checking more hardware. That's just how I approach things.