PC help?

My vista laptop has developed a strange problem.

We had a virus problem earlier in the week - but it was working fine after I cleaned it up. We were burning a CD with Burn4Free when the burning hung So I shut down and rebooted and the problem started.

It boots fine in safe mode. It even connects via wireless to the internet in safe mode (that surprised me).

But if I try to boot in regular mode - it gets to displaying the desktop, starts stuff in the startup - but just before it displays the sidebar, it locks up - clicking on the pointer does nothing.

I've tried disabling all startup programs via CC cleaner (still hangs).
I removed Norton 360 (still hangs)
I tried doing a system restore to 2 days ago (still hangs)

If I run checkdisk on the C: drive it gets to 33% and hangs.

I've been able to back up all the important files to an external drive which is good. I do not have seperate restore disks, just a partiton on the laptop's drive.

Any advice? Should it just be restored from the partition?