Question HelP- Network gone from virus- need to reformat

Something happened to my computer and when used my AV program in safe mode, deleted the problems when I rebooted ckdsk came on and deleted tons of files, my network adapter, my system restore points, my Winsock, my IP connection and now I cannot connect to the Internet.
Computer is one year old Dell Inspirion 531S AMD processor, 231 GHz and 1.93 Ram. Window XP Home, SP3

I was talking to a friend who works at Acer as well as the Cox Tech. They said I have to reload XP. I am going to lose everything I have on the computer.
I only used a 2 gig flash once.
I saw a 4 Gig Scan Dsk at Walmart for 24 dollars. I was wondering if I can backup with that, there is no way I can get to anything to back up online.

1. Can I backup my Bookmarks on IE and FF- How?
Can I back up my music on WMP and RealPlayer? How? Do I have to burn CD's.
When I put the information back on the computer, I need to put have AV and Spyware on to go over it before I put it on.
I can get McaFee again from Cox, however, does anyone know if that is safe or caused my problem? My McAfee said it was expired and when I went to put it back on from Cox website I could not download to IE or FF.

I am a newbie, so, if you can tell me in simple language I would be most grateful.
Thanks for the help in advance.

PS I have an old HP that was not working, so, I reformatted the HD last night , it had a bunch of bad sectors, however, I can get on the net and post, I am keeping this computer bare bones so I can ck this site for help. LOL< I am moving the keyboard and the mouse back and forth between the two computer, with the modem on the floor in the middle and one computer on my kitchen table and the other on a desk.. Life used to be so simple... yet, I go nuts without my confuser!

 

Ok, I got 4Gig Scan Dsk flash drive, I am trying to transfer files, NOT settings, it is NOT co-operating... LOL... I cannot find the back up of files only. I put the files on want in one folder on the desktop. I went to programs, access, sys tools, and all I have is file and settings wizard, no backup. My bothers XP Home has backup in that section.. strange.
IF anyone has any suggestions how I can just bring over my doc's pictures etc.. would appreciate the help.
Thanks
Raven

 

Have you tried to fix the comp in any way?

Before reformatting, I would try this fix - http://support.microsoft.com/kb/299357

Alternatively, you could try using a Live CD of a linux distro to access files.
This thread might be better off in the Software forum if a mod can oblige.