Windows Windows not loading software

I am having problems with a computer running windows XP sp2, I have scanned for viruses and checked for spyware but the symptoms seem quite odd... the affected machine refuses to load any form of game Ie Steam/BF2 ... it also refuses to allow me to browse my computer and use windows utillities such as system restore even in safe mode.. but it will run firefox and internet explorer fine.. does this sound like a software problem or hardware (dodgy ram?) ? I am really stuck anyone experienced anything similar / suggest any solutions?