[Hpro]

There is two things to try .
1.Either scanreg /restore as you mentioned or
2.Boot into safe mode - do a VIRUS SCAN if yo have a AV programm installed..

the other option is to delete the offending file from the C:\windows\system folder or just move it to another location this you have to do from MS-DOS prompt to be successful - you will get a registry error when booting up after removal of the mentioned file but at least you can be sure that it will boot to windows if it is the file which makes the problems..

the command line below is to either DELETE or the second one to MOVE the file..

DEL C:\WINDOWS\SYSTEM\VDRSVAL.VXD and press enter

to move the file

MOVE C:\WINDOWS\SYSTEM\VDRSVAL.VXD C:\WINDOWS\TEMP and press enter

I would not do a reinstall if not really necessary..

Edit

It is possible that the file is not located in the windows\system folder then you will find in c:\windows\system\iosubsys folder - and if yo can't find it then make a search for it in the complete windows folder..