I was just about to make a thread about this until I found this as it just happened to me.
Since im using a dual core computer, it only takes up 50% of the CPU usage. All i had was MS Word, Firefox, and AIM on when this happend, and this happens quite often. The only way to solve this problem is to reboot, which can be quite annoying when im doing something important. Also, when this service takes eats the CPU, all internet activity ceases.
I am using XP SP3. This also happened with SP2.