I had a similar problem on Win2K Server. The solution was a variant of the userinit.exe posted above. I had just run Adaware and got the same behavior where I was in a login loop.
Note, I had access to the registry and file system on the broken machine through my network which made it easy to diagnose and fix.
The following Registry entry:
HKLM/Software/Microsoft/Windows NT/Current Version/Winlogon/Userinit
contained a string that was pointing to a bogus copy of Userinit located in "C:\Documents and Settings\Administrator\Windows..."
I changed the registry setting to point at the real userinit.exe in c:\winnt\system32 and rebooted for success.
Note that the file copy solution noted above didn't work because Winlogon was looking elsewhere for the userinit.exe file.
I don't claim any credit for the fix, it is posted on the lavasoft web site. It's a known problem with Adaware, so lots of people are going to suffer from it.
Good luck to all -- thornfish
