HOLD YOUR HORSES. Ages ago I wondered how to do it, but its HELL easy.
Go to Start, and search 'Create a system repair disk'.
Click it. There should be a window which pops up asking you to insert a cd and telling you what a System restore CD is.
Insert the disk and click 'create disk'.
When its done, just turn off your computer.
Turn it back on and keep hitting F8 (usually)
A menu with a couple of different options come up. Choose the option with what appears to be a harddrive/modem icon.
It will say 'Warning, your hardrive will be completely wiped' etc.. just hit next
Just leave the next option to 'restore to out-of-factory settings' or something simmilar.
then it will wipe everything off your hardrive and restore to factory settings.
When its done, Your computer will restart and will say 'preparing your computer for first use' etc..
If it CONTINUOUSLY does that. Just reboot your computer, tapping F8 and go down to an option 'Stop rebooting after system failure'
Then your computer will reboot again and will start normally