mopsy:My problem new project was created after a recent XP auto-update so I restored my PC to an earlier date. .
Restoring back to an earlier date using windows go back function is one of the classical errors, it seldom works with editing systems and might be the reason to your probs.
You might have to do a clean install of it all now, sorry to have to be the one that give you this info.
As you seem to update your editing system from time to time using windows update, I strongly recommend Acronis or something similar and an external usb drive to safecopy bootdisc images to for the future.