Can ONLY log on in Safe Mode

Hello all; this is my first post here. I'll begin from the beginning.

Earlier this morning, I went to open my email program (I use Thunderbird... that's another story), and Windows basically wouldn't let me open the program. As I usually, do, I went to open Task Manager to see if I could find any problematic processes running. Windows wouldn't let me open Task Manager.

So I restart, hoping to fix the problem that way. Upon restarting, I can't log in. I type my password... correctly... about five or six times. Windows tells me that my username or password is incorrect each time.

I restart again, and then I'm attacked by the infamous Black Screen of Death.
After a system restore from a repair disk I created, I still can't log in to any of my accounts on the computer (in normal mode). I even removed all the passwords, but any time I click on either my own account, my emergency account, or the guest account, it still tells me that "the user name or password is correct." As the title says, I can only log in successfully in Safe Mode.

Any suggestions? Can anyone point me the right way?

BTW, my machine is a Toshiba Satellite L505D-S5983, 3 GB RAM, Windows 7 Home Premium 32-bit. The OS came preloaded and without manufacturer's disks.

OK, for fun (and because I hadn't done it before), I decided to look at the Event Viewer. I had a multitude of warnings and errors, so I looked at the warnings and saw that many of my executables (including WINLOGON) and DLLs were reported as infected. Can't run System Mechanic or Windows Defender in Safe Mode, so I'm installing AVG to figure out what's going on.

Looks like I got my work cut out for me tonight as far as cleaning up this mess...

I used that, and it found and quarantined three infections in the registry:
Adware.SmartShopper
Broken.OpenCommand (occurred twice)

No infections found in any of the files in the windows\system32 folder.

Still no dice as far as returning functionality. I get two different scenarios when I try to log on:

1) either I can click on my username and it tells me that the username or password is incorrect (as stated before, I removed all my passwords trying to fix the problem). Trying to click on the power button in the bottom right corner has no effect whatsoever.
...or...
2) it lets me log on, but then I get a failure in dwm.exe and a Black Screen of Death with a mouse cursor. Pressing CTRL-ALT-DEL shows an error message saying that Windows was unable to display startup or shutdown controls and that I should press ESC or turn the power off using the laptop button.

Still trying to find solutions... I'll keep everyone posted.

I'll try that again. I did it once, but I'm going to try to go much further back than just three days ago.