Sounds like either your PS is going bad or more likely your CPU is overheating.
Edit: Just re-read where the system re-boots constantly if not in safemode. I would wipe the drive and re-install XP. I would suggest checking your PS and CPU fan/heatsink since either of these two could have been the cause for the original re-booting issues which could have corrupted your registry. I would also install firefox and have your mother-in-law use it instead of IE.