Hmmm. I've encountered Vundo before. Used a tool to get rid of it. Might still have a copy on my PC at work. Will check.
First off, I run Windows Update - patch the PC up to date. And install, immunise, and run Spybot. Otherwise you're just jelly juggling. Next I remove the girlware (free pretty desktop wallpapers, shopping toolbar thingy...) from Add/Remove Programs. Full virus scan. I use Spybot's tools to look at the BHO/ActiveX objects and delete any I don't like the look of. If they magically re-appear, I know it's bad. I also look at the startup list - Spybot shows you all the available startup locations (there are a lot). I go after dodgy DLLs (those mentioned in the startup list and BHO/ActiveX objects) using Processor Explorer and Movefile. See here -
http://technet.microsoft.com/en-gb/s.../bb545046.aspx
It's always a major job - can take hours. If you have a backup of your data, a rebuild is likely to be quicker and guarantees the PC is clean.