can't get to recovery console or do clean install

Ok I am getting the \windows\system32\config\system is missing or corrupt {Windows XP Home}.
I have worked and researched and scratched my head raw,lol.
I know everything says to repair the registry, but here is the kicker to my problem...

When I go to the recovery console through the setup cd every thing goes fine until it tell me to choose the operating system in which to log onto, I press one and then enter and it just freezes everytime.

I also went to just reinstall Windows Xp but, When it asks to repair the drive or install windows xp or f3 to quit... I press [enter] to do a fresh install, then it goes to the next screen which says "scanning for previously installed os/windows" and just freezes there.

but when I have my small HD in the pc as the primary I can plug the corrupted HD in after the System starts up and I can see all of my files and use them, Just cant install Windows or repair it?

Oh yeah and System Restore was not enabled on this HD!
Used it for the last year with no problems until this happened.

Please help ---I think I am loosing my mind, lol---

Thanks for the help!
 
There`s the Bart PE CD method,if no-one has a better idea.
I`ve never tried it,but it seems to work for some people. HERE
 
I had kind of a similiar problem not to long ago. Since it sounds like you are prepared to format the drive and reinstall Windows you may want to try to use a Win98 boot disk. Boot to the DOS prompt and then use fdisk to get rid of the partitions. After that you will probably be able to boot off the Windows disk easier and reinstall.

If you don't have a Win98 boot disk anymore check this out. Before you try that though it may be a good idea to go the website of the HDD manufacture and download the diagnostic software. Usually be a test that runs from a floppy during boot up. That will test the drive and see it is still working or needs to be replaced. You could have a dead HDD on your hands.
 
Thanks guys for your help.

I have gotten it to let me go to the recovery console and do a clean install... I just went in through my other HD and then just simply deleted the corrupted config\system file and
then for sh!ts and grins tried again and it worked.
 
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