How can I fix my Packard Bell laptop? Starts up but applications wont open?

When I start up my laptop everything starts up fine. Once i then go to open any desktop applications then they dont open, i can click once on them and they appear highlighted, but once I double click to open nothing happens. I can open up the start menu, but once again cannot open up any applications when I double click. Ctrl+alt+del recieves no response and I then cannot shut down. I have tried a system restore which didnt make a difference.
I'm using a packard bell easynote R1935 with windows Xp. Any help in how to overcome my problem is appreciated.