xp setup is restarting freezes

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I have been getting the blue screen of death 07E error for awhile now on a dell demenision 2350. I've tried everything I've found on forums and finally decided to do a clean install. It appeared to fix the problem but The Blue Windows Setup screen comes up, next a blue screen appears that says Setup is Restarting..........then the screen goes to a blank blue page and freezes. Please help
 

Robert in Los Angeles

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Jan 7, 2012
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My success with "How to recover from a corrupted registry that prevents Windows XP from starting"

Ref: http://support.microsoft.com/?kbid=307545:

I only did "Part 1" and got my Windows XP Pro - OEM to restart.
How I did it was - I moved the HD from the crashed PC to mine, created the "regcopy1.txt" file as instructed, and copied it to the crashed HD at C:\Windows.
Then placed the HD back into the non-booting PC, ran "Recovery Console" with the OEM Installation CD , then did "Batch regcopy1.txt.txt" (no quotes).
Why the txt.txt? Somehow, somewhere, Windows added it after starting "Recovery Console".
Leaving the OEM Installation CD in the Optical Drive, I restarted into "Safe Mode" first, so that I could grab my files unto a Flash Drive. Next was normal boot. Took my system about 30 minutes both ways to finish to the Desktop, so be patient.

Now, that said, do not expect a perfect Windows OS, despite doing a full "chkdsk /p /r" with the "Recovery Console", so that damaged files could be replaced from the OEM Installation CD.

Why Microsoft would instruct us to do Parts 2 and 3 for new registry hives is beyond me, because once one does Part 4, firstly turning off "System Restore" then immediately back on by clearing the check box to get rid of old bad restore points, is beyond me.

Even though I plan to do a clean re-install, I am pleased to get my files back.

Now, if your OS looks healthy and usable, then consider yourself very lucky, because mine is highly corrupted, even though it boots up.
Maybe running more "chkdsk /p /r" passes will fix it?

Sincerely,

Robert in Los Angeles