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Unfortunately troubleshooting frequent system crashes or locking up issues without knowing the related errors or programs causing can be difficult to troubleshoot, therefore we recommend you run through our basic windows XP trouble shooting section found on the below page to help locate and hopefully fix these issues, this page can be found on the below link.
http://www.computerhope.com/issues/chwinxp.htmWe find it real concerning that your favorites, my documents and users settings were erased. To us this does indicate that either a virus is infected in the computer or more likely that a program and/or malicious user has some how gained access to your computer. First, make sure your virus definitions are up to date. Second, you may want to consider installing a spyware program on the computer to make sure your computer does not have any programs installed that may be changing your settings and/or trying to change settings that are causing settings to be lost. Information about spyware programs can be found on the below document.
http://www.computerhope.com/issues/ch000578.htmFinally, you may want to enable Windows XP firewall and/or install a third-party firewall program on the computer to make sure no one is gaining access to your computer that should not be. Information about installing the Windows XP firewall can be found on the below document.
http://www.computerhope.com/issues/ch000551.htmFinally, in regards to your CD-RW not copying files properly or causing files to become read-only we would recommend that you first of course verify you are burning to a CD-RW disc and if so attempt to reinstall your software for your CD-RW as it may have become corrupt.