Total security xp & non-working *.exe files

i was checking my yahoo mail today, left the computer for about 10 minutes, and when i came back, my ie was gone and there were a dozen boxes popping up about security issues. i freaked, of course. but it didn't look right, nor make sense. the giveaway was the windows security center - with total xp security in the titlebar. i got my netbook out and started searching. i've read about the issue, i've tried different techniques, but now i'm really in a pickle!

i tried searching for the program - i didn't have one. i had "ave.exe" at first, i'd terminate it with task manager, it'd pop back up - blah blah. i tried to search for it. it didn't exist (according to my stupid dog friend, should have known, lol). i have all my system files unhidden. i'm using microsoft security essentials. i scanned, and it showed nothing (but it was odd that it was about 50% finished, and then bam, complete - and 50% was after about an hour or so. sounds odd doesn't it?). i tried to get online - that was a joke. i could get to my homepage after clicking no 50 times - but if i put in anything else, i'd get an error.

i downloaded malwarebytes and spyware doctor on the netbook. i restarted in safemode. total xp security had invaded safe mode - and i couldn't use anything! only thing i could do is copy the files over. i'd double click, triple, quad..you get the idea, and nothing. i got fed up (mse did the same thing, only thing in the taskbar was that stupid alert). i restarted again, but let it go normally.

now, total xp security is gone (for now, it could be playing peekaboo), BUT, i can't run any exe files! i can open any program with a file (like use an mp3 to get windows media player open), but when i click on an exe file, i get the "choose the program you want to use to open this file" window. i read about using task manager to get a command prompt - that worked, and i could get malwarebytes and spyware doctor installed, but how do i fix this? and is total xp security gone, or just hiding on me? i REALLY don't want to reformat now - i have tons of pics of my 2 babies on it, and no backup! any suggestions would be GREATLY appreciated! thanks in advance (and really thanks for just reading my problem, lol)