About Windows XP System Restore:

Though this is a desirable feature, in some cases it is necessary to disable System Restore. For example, if the computer is infected with a virus, then it is possible that the virus could be backed up in the _RESTORE folder. By default, Windows prevents System Restore from being modified by outside programs. As a result, there is the possibility that you could accidentally restore a virus-infected file, or that on-line scanners would detect the virus in that location.

When you disable System Restore it does not delete or remove any of your personal data from your computer. The only files removed are those that System Restore created in the _RESTORE folder, the system restore points. Using System Restore to revert to a previously saved restore point does not affect any of your personal data files or any items in your My Documents folder.

This closes the door to many infections as they attempt to reinfect your system. In fact, one of the first things spyware does when it infects your PC is to drop your security settings so it can accomplish the goals of the software author without your knowledge. Checking these settings from time to time will help you keep your computer free of spyware and trojan viruses and eliminate much of the need for time consuming malware removals.