Yes. That means that tere is some system files that is either missing or being corrupted. It could be due to a virus infection or a software installation going bad.
I've two options for you.
The first is to do what the message suggest. Bot the computer with the XP cd and to to the repair section. That action should replace any bad system files.
The other alternative is to just forget about the native search function built into XP and instead get a third party search software. Personally I prefer Agent Ransack over windows search.