Fixed. This was a royal pain in the ass - I recommend that you save yourself a huge headache and just buy a hard drive and create a new installation of windows. Better yet don't do a windows repair as it had the potential to seriously F%$#! you over - In the future I would try a restore point first.... I pulled and swapped out every last piece of hardware on the machine. I flashed my bios and cleared my CMOS. I rebuilt the boot.ini file and disabled all the drivers I thought were the problem within recovery console. Still I was confronted time and again with the damn IRQL BSOD 20min into windows repair.
I deterimed the problem was registry/driver corruption. Wasn't able to complete the windows repair at first due to lockups during serial number entry. Had a legit OEM serial number but unfortunatly was using my only XP CD (a volume licenced copy - turns out serial numbers are CD specific). As this is a side note I'm not going to get into it much, only that if your having CD key issues with a legit serial make sure that your using the correct disc (if not you can create one with n-lite by extracting the contents of the the XP cd you have or have downloaded and chaning the PID field. Note that this PID is dependant on CD key, volume label and SP level. See here here:
Alright, I couldn't get past a blue screen that occured during the final 15 minutes of windows repair (registering components portion of setup). When I exited and tried to boot in safemode I got the message 'windows can't start in safemode'. Exited, booted from CD and loaded recovery console. Went to root (c:\) and typed in 'ren ntldr ntldr.old' after confirmation that the file had been renamed I navigated to my CD drive (e:\) and typed 'copy e:\i386\ntldr c:\'
I then used this
process to make backups of system, software, security, sam and default.bak files (in essance your registry) and restore them to a virgin state. Turned my date back in the bios a month, booted in safemode and manually restored my registry from a known good checkpoint by moving the files of interest to a temp directory, corrected date in bios then booted to XP repair console and manually overwrote registry from the known good checkpoint in the temp folder.
Windows fired right up and I did all my windows updates. Computer is now running like a top!