If this was in fact a worm that 'wormed' its way onto your computer, it will find ways to bury itself deep into your computer so that it can continue to propogate itself after a typical anti-virus may have attempted to clean it. From the sounds of it, it infected certain files on your computer that were probably not salvageable and these files were removed during the cleaning process. If this is the case, and they were files needed by Windows to run certain services, the only real way to fix it is to re-install XP.
If I can ask, what Anti-Virus scanning software have you used to clean your computer? Norton may have been doing a fine job, but if you weren't staying on top of keeping the Virus Definitions up-to-date, there's no way it could continue to do the proper job. This is the case for any anti-virus program you'll ever use.
I'd recommend the following programs to clean up your computer:
AVG Anti-Virus
Spybot Search & Destroy