I'm not a huge fan of system restore (dont use it myself) but if this happend recently you might give that a shot.
Might be you have some spyware on your computer, have you scanned for any? You can run
HijackThis (this is not a spyware finder, so dont remove stuff unless you know what you're doing.) and upload the log so someone can have a look at it.
About your Edit, you can run explorer fine AFTER you ran google desktop?
Also you could check out the event logs: run eventvwr to get it open, start explorer, note the time, and check application / system for any errors at the time you started explorer / booted up.