This is a problem that I have to admit is completely new to me, hopefully one of you guys may have some experience.
When booting up it stops responding, to continue boot up you just need to move the mousepad or press a key, you may need to do this many times to get it to eventually boot into windows XP. Once it has booted into windows it seems to work fine, the only other problem I have noticed is that 3 keys have stopped working, A,S and Z, which I am sure are unconnected with this problem.
Anyone any ideas?

Do you have a lot of dust, dirt, and hair in the cpu fan, keyboard, etc.
The Satellite is a pretty decent laptop, but the original hard drive seems to fail a bit early... Open the case to see which brand and model of the hard drive, then go to that manufactures web site (unless it is Toshiba) and run the drive fitness test.
As far as I know, the Toshaba drives do not yet have a drive fitness test, but Toshiba is as likely to use Western Digital, Hitachi, Seagate, Samsung, or Fujitsu... as their own.

I have checked out the hard drive, memory etc. and all passed OK, which makes me wonder if its a software problem, although nothing like I have come up against before.