Doesn't seem to be a jury in...but I would treat is adware/spyware.
Possible connection with Mirar toolbar, http://forums.spybot.info/showthread.php?t=49812
My take is..."bad image" or "not a valid Windows image" may refer to existing malware or malware which has been removed and still has something pointing to it (attempting to activate it).
I would take a look in both the System32 folder and my startup entries. If no actual file in System32, then it would seem to be a startup pointer (IMO).
I'd run Spybot and SUPERAntiSpyware to remove, if present.