Question : Windows XP SP3 Laptop - Keyboard and Mouse not responding

I Currently have a Laptop with Windows XP SP3 who's keyboard and mouse do not respond once windows loads.  It loads to the CTRL + ALT + DEL Authentication screen but we cannot progress any further.

Steps I have taken:

Tried USB keyboard/mouse - no response
Tried reseating Keyboard/mouse connections in Laptop - no fix
Tried resetting BIOS to system defaults - no change
Tried updating the BIOS and resetting the Embedded controller - no change

When shutting down windows by pushing the power button until it show shutting down windows it starts the normal process to shut down but I get a STOP error (BSOD) of 0x7e which I only had enough time to see this.  

Any takers????

Answer : Windows XP SP3 Laptop - Keyboard and Mouse not responding

a fresh install will help; and maybe a system restore too, as suggested