XP - Welcome .. no icons and more

Hello,
Here is a new one. I am looking at an hp XP notebook that will not let me in. It boots to the welcome screen and gives the normal screen where one can click their username and sign on. This looks normal, but there are no icons.

FYI - I have tried the normal ctl-alt-del 2x method, and can get the windows 2000 style login, and it shows the correct username, but won't validate the password to let me in.

I've also tried a blank password, and Administrator with all the obvious passwords.

Its like it can't validate the credentials. (The is a home pc in a workgroup type config)

Also, if I boot from a rescue disk, I see the users files, so I know they are still there...

Any ideas?

Thanks,