They suggested getting Hijackthis
Downloaded and ran it, it gives a list,after scanning your system, of suspicious executables and registry hacks which affect IE's toolbar,homepage, etc. and you can check off the suspicious entries to delete them. The trick is knowing which entry to delete. After trying a few entries I found these three files in my Windows folder:
1. DNSErr.dll
2. iedll.exe
3. loader.exe
After getting rid of these, I set my start up page back to Yahoo, got rid of the unwanted favorites it kept placing in my bookmarks, and ran spybot. I rebooted my system and restarted IE and lo-and behold, it worked!
IE is now clean. I just wanted to thank MS and the spammer/hijackers for making such a wonderful experience possible. It's the last time they'll get away with screwing up my browser since Mozilla Firebird will be my browser of choice from now on.
I'm still not exactly sure why these hijack writers aren't treated as hackers and hauled off to jail. This insidious scumware behaved just like a virus on my system. The only difference is these hackers have found a vaguely legal way to make money.