Wallpaper Changing - Warning me of Viruses

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Hello. To anyone that can help me, I want to say how much it is appreciated. My husband has been having problems with his computer. I completed several scans using Norton Internet Security 08, CCleaner, & Spybot S&D. I seem to have removed most of the issues except for one. The wallpaper has a threat that spyware has been detected and it does not allow you to change. There is also an icon on the task bar tray that looks like the microsoft shield but when you scroll over it no information is provided and it keeps on providing a bubble stating that "windows has been infected" - what can I do to get this removed? Is there any other scans that I can do to make sure that the computer is fixed and spyware/virus free. Thanks in advance for your help.

Additional Information:
I have downloaded Smitfraud Fix and had the program clean out anything that it could find but this still did not resolve the issue.
 
Download Smitfraud Fix
http://siri.urz.free.fr/Fix/SmitfraudFix.exe

Clean:

Reboot your computer in Safe Mode
(before the Windows icon appears, tap the F8 key continually)

Double-click SmitfraudFix.exe

Select 2 and hit Enter to delete infected files.

You will be prompted: Do you want to clean the registry ? answer Y (yes)
and hit Enter in order to remove the Desktop background and clean registry keys associated with the infection.

The tool will now check if wininet.dll is infected. You may be prompted to replace the infected file (if found): Replace infected file ? answer Y (yes) and hit Enter to restore a clean file.

A reboot may be needed to finish the cleaning process. The report can be found at the root of the system drive, usually at C:\rapport.txt

Optional:

To restore Trusted and Restricted site zone, select 3 and hit Enter.
You will be prompted: Restore Trusted Zone ? answer Y (yes) and hit Enter to delete trusted zone.
----------------------------------------------------

Additional Steps:

(Start -Run)
sc stop Messenger
sc config Messenger start= disabled

Restart
 
Thanks

Thanks for your information & steps: I followed what you provided me but the problem still persists. It started out as though it may have worked but then when I tried to change the background to a pre-programmed wallpaper and the problem started up again. The wallpaper changed to the warning and the icon re-appeared on the task bar. Are there any other steps that I can follow to remove this from the computer. It is starting to affect windows and my computer has already shut down because of it. I am using my laptop to get information on this website.

Thanks again for all your help.
 
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