Miguel K's winning answer
While you alluded to the use of various antispyware utilities, you failed to mention whether your daughter's computer is protected by a firewall. This is a key consideration and the first part of the solution to your problem.
You are being bombarded with pop-ups as soon as you boot the PC because of adware configured to run whenever Windows starts. Adware is a type of spyware that monitors your Internet behavior, then "calls home" without your knowledge. The information collected and shared with a third party is used to select advertisements tailored to your surfing habits, which are then downloaded and displayed as pop-ups. As you have realized, this process does not depend on any other programs running, so SP2's pop-up control - an Internet Explorer add-on - is of no help. But successful adware depends on access to the Internet, and this is where a solid firewall comes into play.
A strong firewall like ZoneAlarm blocks such unauthorized connections to the Internet, thus preventing adware from downloading ads. When you disconnected your cable modem, you essentially blocked outgoing Internet traffic just like a good software firewall does.
Since you have SP2 installed in your daughter's PC, chances are you are running Windows Firewall. This is a very basic firewall that prevents intruders from getting into your computer, but it doesn't prevent spyware already in it from accessing the Internet. In contrast, a more powerful software like ZoneAlarm monitors and controls both incoming and outgoing Internet traffic. Any spyware present will be unable to phone home. If you are currently relying on Windows Firewall - or have turned it off for some reason - do yourself a favor and install ZoneAlarm Personal as soon as possible. You can download this excellent firewall for free by visiting http://www.zonelabs.com/.
Sometimes, antispyware utilities detect a known spyware program but fail to remove all of its key components. Active or potentially active spyware "fragments" that remains in your computer might not be detected during future scans. In addition, restoring your computer to an earlier point might also restore registry values that allow adware and spyware components to run once again. (Because of this, it would be a good idea to disable System Restore while you perform the following troubleshooting!) Thus, it is imperative that any spyware leftovers are removed manually, or kept from running during startup. Adware that is unable to download ads because of a firewall might still display blank pop-ups, which would be just as annoying!
Since you indicated that you have Spybot Search & Destroy and Ad-Aware SE, let's start the next phase of troubleshooting by making sure the latest detection definitions are installed. Download any newer software versions and definitions, then scan your computer first with Ad-Aware SE, then with Spybot S&D.
After removing any spyware detected during the scans, click the Immunize button on Spybot S&D's toolbar, and follow the prompts. The Immunize function will provide real-time protection against the installation of some spyware. Real-time protection is indispensable if you want to keep your computer free of spyware. Another excellent tool you should consider is Microsoft Windows AntiSpyware (http://www.microsoft.com/athome/security/spyware/software/default.mspx )
Next, start Spybot S&D it in Advanced Mode, if it is not configured to do so already. (To switch modes, click on Mode on Spybot S&D's menu bar, then choose Advanced Mode from the drop-down menu). On the left, you will see the toolbar with several buttons. Click on the one labeled Tools, then choose System Startup. This is a very helpful utility that lists all the programs that run when you start your computer. When you click an entry in the main window, Spybot S&D will provide a brief description of the program. (If you are unable to see the descriptions, click on the gray bar with the two navy arrowheads, and drag it towards the main window to display the additional window, which has a pale yellow background.)
If any program is identified as spyware or adware, deselect the entry by clicking on its corresponding box. Understand, you are not actually deleting these items from your computer. By removing the check-marks, you are preventing spyware (or any other program you choose) from running the next time you Windows starts. You do have the option of deleting the entries, but it is a good idea to just disable them for the time being, lest you accidentally delete something you actually need, like your antivirus or a Windows component. You can always run the System Startup utility after you are sure everything works fine, and delete the offending entries.
(Incidentally, you can disable programs set to run on startup with the Windows XP System Configuration utility (Msconfig.exe), but the latter lacks program descriptions. Because many of the programs have very cryptic names, you are likely to end up guessing and disabling the wrong things!)
Once you have disabled any spyware components listed under System Startup, restart your computer.
Hopefully the pop-ups will be gone, but if any are still displayed, you can use the Windows Task Manager to see which processes are running at that time. Write down their names, and look them up in the Task List Programs database found at http://www.answersthatwork.com/.
Again, if there is anything identified as spyware or adware, you can disable it using either Spybot S&D's System Startup utility, or Msconfig. If you are unfamiliar with the Windows Task Manager and Msconfig utilities, you can find a description of these tools by clicking your computer's Start button, choosing Help & Support, and entering the corresponding terms in the search box.
One last consideration: It is possible that you may be running a legitimate program that has adware components or functionality. For example, if you complement your broadband connection with, say, America Online, many of the pop ups might come from AOL itself. These might not be recognized as spyware when you scan your computer. Moreover, because a firewall would grant Internet access to AOL and its components, it might take some trial and error before your firewall is configured to block access to those components responsible for a pop-up blitz.
Having said that, I am pretty confident that if you follow the preceding troubleshooting advice, you will solve the pop-up issue to your satisfaction.
Submitted by: Submitted by: Miguel K. of Columbus, Ohio