1. You can't "force" a restore to a point in the past; if no restore snapshot already exists for a given date, there's no way to go back to that date. The "create restore point" option is only for creating a new snapshot at the time that you execute that option.
2. In terms of reinstallling Windows, XP does have a "repair installation" method, as jhay116 mentioned. Instructions and advice on the procedure can be found here. The Repair install will basically "refresh" your current Windows installation, replacing your existing operating system files with copies from the XP CD, but leaving your data and installed programs intact.
Before going that route though, you should run the System File Checker first, as it is a less "drastic" way to repair (at least some of ) the possibly corrupt or missing core Windows components. A visual/graphical walkthough of using the SFC tool can be found here.
3. In terms of the "unable to complete the operation..." error from Event Viewer, there are different causes (and fixes) for that category of errors, but given the state of your system right now I don't think it's a good idea to start randomly trying the different fixes. Try running SFC first and let us know the results.