Just to make sure this was not caused by any HW, you should test at least the HD.
You need to find what brand of HD the laptop has, and use the HD diagnostic utility program. If you do not have this, you may download it from the HD manufacturer?s website. If you need more information, please post a comment so I can give you more in detail.
If you have important data, I strongly recommend you to backup those before you try any.
Backing up data might be a little difficult because the computer is a laptop. If you can take out the HD, you may use a laptop HD adaptor to connect to a desktop (with WinXP or 2K) and copy your data.
Options
1. Buy a commercial software (e.g. ERD Commander 2003 from Winternals www.winternals.com) and do System Restore to a date before the critical updates.
2. Reinstall Windows on top of the current one. All your applications and data should be intact. You may have to reinstall the Service Pack and other Windows updates.