Safe mode made no difference so I used this as an excuse to upgrade the machine. Gutted it last night and replaced the Athlon XP2500 with a P4 mobo and chip, doubled the ram to 1Gb and reinstalled with XP Pro.
Thanks for trying everyone.
Well it seems that it's just one of those anomalies we'll never find a working solution, however I'm presuming formatting and re-installing XP Pro did the trick Deaks? :)
Yep, no problems now, installed the new sata drive chassis and first 500Gb drive for the new storage I wanted to put in too and all is functioning as it should.
I hate giving up on a problem like that but sometimes it's just not worth the effort if you know a reinastall will probly sort things out anyway.