If you're having problems with Windows system recovery try out some following tips. They were useful on a Windows XP computer, but certainly can be tried out on Windows Vista and 7 machines.
You can try booting into windows safe mode by hitting an F8 key after a BIOS screen flashes and before windows tries to boot. In a windows safe mode menu select "Start Windows with Last Known Configuration".
If that doesn't resolve the issue try booting into safe mode again only this time select "Safe Mode with Command Prompt". Once in safe mode a black window with a command prompt will open up and type "fsutil dirty set c:" without those quotes. Reboot your computer and allow chkdsk to run completely.
Another option is to perform a repair installation of windows XP. You shouldn't lose any data, however some of your windows settings might be changed. Boot from a Windows XP installation CD.
Do not choose an option to repair an XP installation using Recovery Console when prompted, choose an option to set up Windows XP now press ENTER. After more files have been copied, you'll get another selection screen where you should select a current XP installation and an option to repair selected Windows XP installation, press R. Check out this short Microsoft repair windows xp tutorial, showing you how to perform a windows XP repair installation.