When does the Distortion Appear? Is it After the POST (Power on Selft Test) or During the POST? In other Words. Can you see the Screen Coming on and can you enter The CMOS? Or is it as soon as Windows starts Booting?

If you see the distortion before you can see anything else on the screen you probably have a Hardware Failrue somewhere. Try Re-Seating your Display adapter/RAM/CPU and IDE Devices and make sure all these Devices get detected during the POST. If that does not Work you might have a CMOS Virus or the CMOS or Mainboard got damaged in some other way: maybe lightning. Maybe try another Monitor aswell??. The best is to have the PC Returned to the Hardware Vendor from whom you bought the PC from so they Can Check all your Hardware or Re-Flash your CMOS, Wichever turnes out to be the Problem.

If the Distortion Displays as soon as Windows Boots Try Booting into safe mode (Windows XP gives you the Option to press F8 for FailSafe Options just before the XP Boot-Up screen appears) and ensure All Devices are Setup properly. You should also do all your Virus scanning and Removal from Safemode to ensure al Viruses get Removed Properly. If you cannot go into safe mode you probably will have to reload Windws. (Yippee for MS)

Hope this Helps