Hello Hi Ho!
I've had similar problems with XP, though not to that extent. What you could do is try to figure out what is wrong.
First try to log on as 'Administrator' (press Ctrl-Alt-Del twice from the welcome screen and use the password you supplied during setup) and check if there's a problem. Sometimes the problem is limited to just a single user account. If the Administrator account is also ineffective, try starting up in safe mode.
What I found was that some NT services like Indexing Service, Background Intelligent- etc. were causing my system to get stuck. (Located in Cntrl Panel>Admin. Tools>Comp. Management|Services)
Disabling some of these seemed to help.
Hope you get it right soon.