Just so I understand . . . are you are booting to the recovery disk 1 or are you trying to do the recovery from within safe mode?

I assumed you were booting to the disk 1 or pressing F-11 until you enter the recovery utility and it asks you to insert disk 1. Either way should give you a fresh install of Windows. Use the non-destructive if possible to save your data. I'm just not sure you are doing the system restore correctly, sorry, not trying to be difficult.

I'm using the DVDs i burned to do the recovery (i.e boot from CD-ROM or whatever, follow on-screen instructions, etc). In other words, the method you suggested, right?

Yes, the manufacturers restore utility should run completely independent of Windows. I'm not familiar with eMachines but it should resemble a DOS program or a simple text interface.

I'm pretty sure it ran through Windows using a similar themed setup thing to the repair screen i was being dumped to before.

When you created the disk you would have used a screen similar to the attached image. There should have been a message upon completion indicating the disks were completed successfully. You should also be able to put the disks in another computer (not meaning to run them but just to look at the data) and see that there are files / folders on the disks.

Two ways to use the disks -
1)Most eMachines are supposed to open the recovery utility when you press the F-11 key repeatedly while booting (saw that some will do the same with the R key) Once in the utility there should be a menu with choices for recovery. This should recover the system from the hidden recovery partition or . . . it may ask for you to insert the recovery disk 1 if it does not find the partition.

2) Boot to the recovery disks and get the recovery screen for the utility. Again there should be a menu for recovery options.

Both are independent of Windows and should run regardless of the existing Windows install with a fresh install of Windows being done at completion.

It is difficult to give a walkthru on a system I am not familiar with but usually it a straight forward menu that guides you. My concern is that your recovery disks were not created successfully or that . . . when you try booting to disk 1 . . . your system is not booting to the disk but rather to the hard drive as it usually does. If you have set the DVD drive as the primary boot drive and the booted recovery disk does not recover the system then, again, I would say the disks were not completed successfully.

If the disk creation failed, most manufacturers sell the recovery disks for individual computers on their web site for a nominal fee (usually $25 - $30)

I only use the manufacturers recovery as a last resort which seems to be where you are now. Might try to reboot, pressing F-8, and use the last good config option or get into safe mode. If you can get to Windows, try making the disks again, should not be allowed if they have been created successfully. If you are in windows than your system probably does not need to be restored but rather the problem diagnosed and fixed. The problems you have may not be that bad but they are beyond the scope of our conversations here.

It sounds like the initial problem was a Windows system restore that failed . . . the clean up in particular. Do you know a knowledgeable person that could take a look at it?

Yes, i used a very similar screen to the one on the attached image when creating the recovery discs.

Yes, i used the discs, i can't really be 100% sure that the recovery i did USED the discs, but i have reason to believe that it did because i was asked for the second and third discs throughout the recovery process. I changed the boot order to the CD-ROM first, rebooted the system and the system automatically loaded the disc and started the recovery program.
The option i used was Completely Restore System to Factory Defaults (the other option is Restore Operating System and Retain User Data).

And no, i don't really have anyone that could take a look at the computer in-person. I know my way around computers, but this is so far one of the worst problems i've come accross that i haven't been able to fix myself or with a little help from someone else. If all else fails, i was already suggested the recovery discs from the manufacturer, but is that even a 100% sure solution?

Sounds like you have ran a successful recovery so . . the computer should boot up to a new install. I believe, with your description, that you did create and use a recovery disk so I don't believe the manufactures disk would do anything but the same, save your money.

I too am out of suggestions. Did the recovery format your disk or did it do a non-destructive restoration?

I assume the recovery gave no errors and indicated the recovery was successful? So now it boots up and ends with a BSoD. Any way you could take a snap shot (digital camera?) of the screen and post it?

If you can boot with a Linux live CD (Ubuntu for example) and email me the dump file (you can find it in the Windows folder, it should be named MEMORY.DMP, or any other file with the .DMP extension) I'll take a look and try to see what's causing the BSoD.

I'll PM you with my email address.

Sure can, i'll post back in 15 or 20mins.

Here it is: http://i72.photobucket.com/albums/i186/DM_Phantomizer/SDC10280.jpg
@ AndrewC: Thanks a lot for the offer, if i exhaust all other possible options i'll try that because if i install a new OS, the previous one would be overwritten, no? especially considering i don't have the Windows discs.

This appears to be a driver problem. Strange since the system recovery should have installed all original drivers.

Can you get into safe mode now? If so . . .

Find and uninstall any software / hardware you have installed recently. (should not be any if the recovery did its job)

Hit Windows key + R and type msconfig then hit enter. Go to the startup tab and uncheck any startup items that look suspicious especially look for Startup Items that are all numbers / letters.

Try rebooting and see if it will go into Windows normally. That keygen was nasty it seems. . . =)

Some good info here as well

Edit: system should dump every time there is a BSoD, might give a clue to which driver is causing the problem

There are very few start-up items, so if it's one of those, i'll just use the elimination process to see if i can find the culprit.

And yes, it's the first and last keygen i'm likely to use. This has been a rather unpleasant experience that i don't wish to repeat if i can fix it.

Also unplug any peripherals, printer, router, network etc.