It sound just like the virus I had a few days ago.
You could try and follow this steps to clean the virus.
1. Start Windows in safe mode.
2. Stop a process in memory called wscript.exe using the task manager.
3. Go to My PC and open your hard disk (c:)
4. Go to file options and in disable the "hiding system files" option.
5. You will see now several files named autorun (.exe .bat .inf .reg .vbs) in the root of your hard disk. You must delete them.
6. Then you have to go looking for the same files in other folders, almost always is in the C:\Windows\system32\ but i have read that some variant hides a folder of itself.
The restart the system. You should clean your USB flash disks too, but don't let them open with the AutoRun option. Open Windows Explorer, plug the USB flash and you will see the same autorun files in the root. On commons USB flash disks, you can delete them all, but you can keep the autorun.inf and see inside before to be sure.
If it don't work, the you could still have the virus in some other folder and have to do a search.
Hope this help you, I know this virus can be a real problem.
PS: sorry for my mistakes, I have Win Xp in spanish so don't really know the menus names in english