Yes, infected - a certainty. If possible, download all the stuff required for attempted fixes (see our malware page), onto a flash drive by using another PC. See if you can start your PC in safe mode, and try running things from the flash drive.
You probably won't get anywhere though, these particular infections that stop you doing most things are very hard to eradicate, and need an expert approach. I hope you have backups of all your important data, because you will probably end up having to reinstall Windows from scratch.
If you are (or know someone) reasonably expert, the best approach to these problems is to put your hard drive in another PC and disinfect it from there, but I hesitate to suggest you cheerfully bulldose someone into doing that, because it is all too easy to infect the donor PC as well - nice present !
Those who know about these things run from a CD copy of linux or even better, Ultimate Boot for Windows
http://www.ubcd4win.com/ (a CD is read-only of course and cannot possibly become infected).