Dead Psu, Mobo Problems, Hard Drive Problems or other???

I am currently running an hp pavilion a630n, running with 1gb of ram and an ati x700 graphics card(overclocked) on windows XP home edition.

Recently my computer has been having start up problems. The computer will run through everything perfectly until it gets to the desktop screen, where all of the desktop icons will load, but then my computer will just freeze (hard drive just stops spinning). Sometimes the computer will load some tray icons (like Mcafee anti-virus) but other times it won't load any at all. I have edited the start-up programs to only have programs that I need to run. I have also defragged and done multiple disk-checks on the hard drive. Finally, I have run a computer diagnostic program that came with the computer which checks the different parts of the computer, all parts including mobo, ram, and hard drive are fully functional.

To try to remedy this problem, I just keep restarting the computer. Occasionally I will pull out the power supply cord and let the light turn off because I have heard this works?

BTW my power supply is 300 watt stock and all cooling is stock also.

Hope you guys can give me advice on what it is that could be causing the problem.

Yes.. I have run it in safe mode and windows starts up normally like it should.. so I highly doubt it is windows which is the problem