If I would be in your shoes, I would just copy the sensitive data (pictures, documents, music, but no .exe, .bat, .dll files) to another partition/HDD then do a clean reinstallation of the operating software. The first thing after that, install a good antivirus software.
Also, having two partitions, one for the operating system and one for data storage is always a good idea. Having a RAID system set up is a better one, but it's rather expensive in terms of finances and knowledge.
And once you have a (relatively) healthy system, backup weekly on as many devices as you can afford. There is no such thing as too many backups. You can even try to clone your system partition (with Ghost or Drive Image or similar software) to avoid this nasty situations. Once you have a copy of that partition, you can revert to it every time you encounter problems.
There are some antivirus software that can run from bootable CD, so you don't need a healthy operating system, if it is damaged, it can be fixed from the boot CD. It's better to always have one of these at handy.