John I think you need to clear your hosts file anyway and let it reset from default.
I havent come across this kind of thing before so I'm going to run a temporary plan of attack to you and I think you should perhaps wait for a second opinion as there may be different ways to sort out the problem. My way is a basic fix-it by starting your hosts protection off all over again with mvps. I'm not going to bother looking at whats in there or what may be trying to take over if that is the case. Seems was doing an okay job back when you were also using Spybot.
This how you set up again with mvps.
Go to site --
http://www.mvps.org/winhelp2002/hosts.htm This is the text you're looking for -- (where the blue color denotes hyperlinks)
To view the HOSTS file in plain text form. (597 kb) (opens in browser)
Note: The text version also makes a terrific reference for determining possible unwanted sites
Download: hosts.zip [right-click - Select: Save Target As] [Updated May-11-2009]
This download includes a simple batch file (mvps.bat) that will rename the existing HOSTS file to HOSTS.MVP then copy the included updated HOSTS file to the proper location. For more information please see the readme.txt included in the download.
You will want to download
hosts.zip from the page. Extract files from the zip package and and follow directions on the readme text document closely.
You might also look at using Hostman, which should return your hosts file to the state it was in back in the days when you also had Spybot.
Here is the logic behind protecting against intrusion of your hosts file
http://forum.avast.com/index.php?topic=43658.msg365399#msg365399But for now, just hold on a moment and see if we have another opinion because I 'm not sure whether the hosts file issue is the cause of your problem or just another effect. In the event you run with mvps for hosts file protectoin then you can run another HjT scan and see what is brought up this time.