system32 folder corrupted

This will be a long explanation and I appologize for that right now....LOL.
I'm working on a computer for a friend. I have some small knowledge of things and this will end in a question that I hope will teach me one more thing.
So:
My friend supposedly: De-fraged his comp. Then ran a virus scan. Rebooted and got an error message telling him the comp was missing the autochk file, was skipping the autocheck and then shut down with an "error 21" message.
So yes, that's where it was when I got it.
Here's what I found:
Connecting the hard drive to another comp., I ran a virus check with an upto date Norton AV. No problems. The system32 folder is "visible" on the drive but, when I try to access it I get a message telling me it is unaccessible. Selecting "properties" gives me a folder volume of 0 bytes. I've seen this before so I ran "Easy Recovery" on the drive and "found" the system32 folder and all of it's contents. But, I'm assuming that since it's "unreadible" that's what's keeping "Windows" from reading it during boot-up. So, I know I could just "save" everything and then re-install Windows but, that would mean I'd have to re-install all the programs and such. I was wondering if this option would be possible:
Could I "save/recover" the system32 folder to another drive. Then delete the damaged system32 folder and copy over the "saved/recovered" folder back into the original "Windows" folder. I don't know whether "Windows" will automatically see the recopied folder as the original or if the original installation references will be deleted with the original folder. (Hope that makes sense).
So, thanks in advance to whoever gets to this....

Later on,
Dmin11

 

Almost Forgot:
P-4 CPU
2G RAM
OS = Windows XP Pro version
120G HD