Windows XP SP3 blocks on start with XFX PVT86SWAHG GF 8400 GS 256 MB

Hi! I just came in possession of a friend's PC which doesn’t want to load WINDOWS XP SP3.
The thing is that in Safe Mode the windows, starts and is working. Also the OS is working if I don’t have the graphic card driver installed, but is not performing well, has lags and I cannot play games.
But after installing the graphic card driver, the Windows passes the boot section and blocks on the screen of loading Windows, the red led is flickering for a few seconds and then stops and after 1 or 2 minutes of freezing, the PC makes a beep and restarts.
So I have to enter in Safe Mode to uninstall the driver for the video card to be able to load and run Windows normally. But now the graphic card is not recognized by the PC. With the graphic card unrecognized I can still surf the internet, listen to music, chat on messenger or download from internet.

I think it’s a problem with the graphic card XFX PVT86SWAHG GeForce 8400 GS 256MB on-board Supporting 512MB and I don’t know how to resolve it.
How can I solve this thing? I’ve tried different versions of driver for the graphic card and still doesn’t work.

I don’t have any cd’s with drivers so I’ve opened the case to find the information about the components. I’ve downloaded the drivers from Gigabyte and Nvidia WebPages.
So, the PC has:
- Motherboard Gigabyte with chipset Intel, no on board graphic card and on bord LAN and on board audio card Realtek (I don’t remember now the full description).
- Processor Intel duo 1,8 GB
- Video card XFX PVT86SWAHG GeForce 8400 GS 256MB on-board Supporting 512MB with passive cooling
- 1 memory card of 1GB
- Windows XP SP3 Professional