Thnx for responding Geekgirl
Yes, I can boot into Safe Mode.
Choosing Last Known Good Configuration has no effect if trying to run in Normal Mode.
Also, I switched the System Restore off previously, so there's no point to restore too...
My current bet is that I should fix/remove the corrupted part of "system" registry file and simply put it back in Windows/system32/config
(btw. if I'm using the system file from Windows/repair everything works fine, but all settings are defaulted, which is kinda a problem...idea is just to save as much as possible from current system reg. file, since it's 99% OK)