You should dump your Norton Protected Recycle Bin and your Norton quaratined files.
Download Hoster (
http://www.greyknight17.com/spy/Hoster.exe) and run it. Choose the 'Restore Original Hosts' button and press OK.
Double-click on C:\WINDOWS\wininit.ini to open it in Notepad. Delete all of the lines in the file. Save the file and close Notepad.
Reboot and post a fresh HJT log, along with a report on your condition.