Possible Windows Registry Corruption

Hello all and thank you for your time.

I have a wi xp pro machine that I beleive has a corrupted registry even though it states the obvious.  here is the message that I get when I log on to that machine.

"one of the files containing the system registry data had to be recovered by use of a log or alternative copy.  the recovery was successful."

I dont think it was too successful because after I log in windows explorer does not load.  I dont have a task bar nor any icons on the desktop.  all that is up is a background.  I can launch task manager and see that all processes are running except for explorer.exe.  I try to run it but I get nothing.  I try to run the recovery console but get the blue screen of death.  I am trying to avoid reformatting the machine because the employee just left the company and I dont have a record of all applications that was on the machine.  the computer was so upset that the employee left that it corrupted itself.

Has anyone experienced this and how did they fix it ?

Thanks