Fixing Windows XP on Acer Netbook

Dear Tom's Hardware community, I have run out of ideas on how to fix this netbook. Recently my girlfriend's mother's netbook was infected with some kind of malware. I boot the PC into safemode and installed Windows Malware remover. After removing the infected file the pc reboots with just a blinking _ . My idea after having that issue was to reinstall Windows Xp off a flash drive because the Netbook does not have an optical drive. The bios is already setup to boot of a flash drive and so I downloaded a few different programs making bootable usb drives. The usb flash drive boot is broken up into 2 parts. First I followed the steps and when it gets to where you would "setup" Windows it comes back with an error that C:\\ is corrupt and installation cannot continue. If I follow the second step I get a hal.dll is missing. If I choose the option where it says use this option is hal.dll is missing the computer freezes. Now also on this boot menu in the second part of the installation you can boot usb debugging and then the PC starts up as it was before the computer was before removing the infected file. While in that mode I decided to try and download a Windows Xp iso and install Windows from the desktop while using a mounting program. That installation also fails in the same way the usb boot drive does. Without the flash drive I cannot get the pc to even boot into Safe Mode. I am almost tempted to burn an ISO to a cd and buy an external cd drive for the netbook and even after that I feel that I would have the same errors I am having now and just be out the cost of an external drive. I don't want my girlfriend's parents to have to bring the netbook to a PC repair store and get charged $100 just to reinstall the OS. At this point you could understand I am at least tech savvy enough to get this far. I have also drive using the recovery console and the fixboot/fixmbr options do not work. Any suggestions would be awesome. I am putting my chances of completion with this project in your hands.