You own Adobe premiere pro 2. Your time line is frozen and will not play even though you have cleanly reinstalled and repaired. You have adequate memory, your system has been defragged and your project settings are correct.
Any suggestions, you ask? You can try Windows XP system restore if you haven't already. Basically, you pick a past date before you were having problems with your Adobe Premiere 2.0, to restore Windows XP to. You can check out how to restore Windows XP to a previous state article from Microsoft.
Another option I recommend is to download and install CCleaner. Use CCleaner for cleaning your PC and registry cleaning. Once you run both clean and registry scans with Ccleaner, then try to reinstall Adobe Premiere 2.0.