Registry problem

What do you do when you get an after trying to boot to safe mode that says “registry cannot load hive file\systemroot\system32\config\SECURITY or its log or alternate. It is corrupt, absent or not writable.
Beginning dump of physical memory”

Windows will not load, it gets to the XP screen and then says Windows did not poad properly….etc. I then try safe mode and get the first message above. I have read about using the XP CD, going into the recovery console and then manually editing the registry but when I choose to log onto the c drive from the recovery console it hangs up and goes no further.
Any ideas short of doing a format? This laptop belongs to a friend who does not want ot loose his files if possible