I don't know what to do, but I feel your pain . I remember having experienced this on XP Pro (an oxymoron if I ever saw one!) after I installed Tuxedo transaction monitor from BEA. I don't remember details, but if I started something else first (I think control panel), then explorer would open. I think the thing cured itself spontaneously after installing something else. Enterprise-caliber platform, indeed!
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Dragi "Bonzi" Raos Q#5196 MkII #080000376, 18GB green MkIIa #040103247, 60GB blue