there is probably a componenet that is missing that you need to use system restore you could just use the system restore of the xp cd and get your windows back to original state without losing all your files and programs.
More than likely, you will be unable to restore. This could be because of corrupted restore files, an unremovable update, or like mikeandike22 suggested, maybe the System Restore components are fubared. Try his suggestion, but consider this as well:
If you can't restore from any point, you probably won't be able to do it at all. If that's the case, you need to delete all of your restore points by disabling System Restore, re-enable System restore, and then be able to do it from there. To disable/enable System Restore, just right click on My Computer, and the options are under the System Restore tab.
I was helping someone with their pc, having probs. System restored, went back further system restored. Prob still there went back to a further date to restore would not restore due to disc space. They had Me on small comp. They were adviced their comp too small for me/xp and told to run 98 by a tech.