Most unsolvable problems can be solved by running virus and antispyware programs from safe mode.
We did that, it didn't help with this one.
Call me a cynic, but I think Microsoft believes many of their customers are suckers, and I'm starting to agree with them. If people can't be bothered to download free antivirus programs or even turn on the built-in XP firewall, but yet complain that they then get infected, why shouldn't MS try to cash in on them to the tune of $50/year?
The smart folks are gonna use the free solutions...but then the smart folks aren't infected in the first place.