Earlier today my security software alerted me to a ati-something executable (located somewhere in the Windows directory) trying to create a new process out of the blue. Fearing malware I blocked it. When I rebooted my computer, my high-res wide screen monitor loaded with WinXP at only 800x600 resolution and I can't up it any higher (my LCD monitor is very picking about which resolutions it supports).

I've tried installing new drivers for my Radeon X300 graphics card, I've tried rolling back its drivers to earlier versions, I've tried uninstalling the drivers and installing the latest version from ATI/AMD's website, and I've tried installing the drivers that originally came with my computer from HP's website... nothing works, and I keep getting told that drivers can't install because of a hardware problem. Specifically:

"An error occurred during the installation of this device [i.e. my Radeon X300 graphics card]. A device attached to this system is not functioning."

Any recommendations on where I can go from here? Is this certainly a hardware problem?  Is my graphics card salvageable?

Do you have another monitor and lead that you could try? Maybe borrow one?

It could be your graphics card, or your monitor (or lead), but it would be helpful to prove it with different hardware. I don't think we can diagnose a hardware problem so easily just from the symptoms.

Looks like you've tried everything on the software side.