I think IE7 for xp is similar if not exactly same as ie7 for vista. I use vista but hopefully this will help.
On toolbar menu where you see "File", "Edit", "Favorites", etc. Click on tools.
Then click Internet Options, then advanced, then reset.
Resetting IE7 will reset IE7 to manufacturer's settings. (i.e., the way it was before you even touched ie7)
Maybe that will fix your problem. But cookies, favorites, home page settings, etc will be reset so you might lose your stuff.
This has fixed problem for me before so give it a shot.
good luck.