Can't change security level

Have a Windows 2000 Professional PC on a domain with a Windows 2003 Server as the Domain Controller.  There are no group policies set for this particular issue, which is what we checked first.  The problem is that the security level is set to Maximum in Internet explorer which is causing the whole machine to misbehave. Active X is disabled which affects applications like MS-Word and Excel.
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ttelesca--When you are on the IE Security tab what happens when you click the Reset all zones to Default button?  I understand the slider will not move.
Perhaps this will help you make the change in the Registry;en-us;182569
If the problem still exists, you could also run SFC /SCANNOW from a command prompt.

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