Windows 7 does not boot past "setup is preparing..."

My laptop froze after entering a wrong product key. I then pressed the shut down button till my computer went off. I restarted the computer and chose the "start windows normally" option. The laptop boots to "setup is preparing for first use" screen. It lasts for about 1 minute and then the computer restarts automatically following the same processes.

If this is your specs below,may best to stay with Win XP.

thanks a lot theog but my other problem is that i seem not to be able to enter the setup of my computer. I have used all the function keys before start up but they all dont respond. Please throw more light on this for me. Thank you.