Ok, here we go....
The log looks pretty good.
First of all, I would Uninstall the Startup-Mechanic Startup monitor. Now supposedly this program is supposed to offer boot protection of your PC from harmful trojans, adult-dialers, and other scumware. Well it obviously did not work. Uninstall it.

Your System Restore can now be reset with a new, clean restore point.

Now for the unnecessary Start up programs;

The program I always recommend using (and do so myself) is Mike Lin's Startup Control Panel to turn off these unnecessary items. It is FREE, very easy to use. Just download and install it and you then will find it in your Control Panel.

Now to begin here is the list of installed programs showing that are auto-started that you CAN stop from auto-start using Mike Lin's program, NONE of these are not needed to run the computer, they use extra resources AND they also can slow your start up time and they all can easily be run MANUALLY when you need them;

ehTray>>>Enables the user to access Windows Messenger from within Windows Media Center Edition
RTHDCPL>>>Realtek HD Audio Sound Effect Manager
HPHUPD08>>>Related to Photosmart_Essential_Software from Hewlett-Packard
DISCover>>>on demand video games
DiscUpdateManager>>>related to DISCover
HPHUPD06>>>Belongs to the HP Photosmart application and is responsible for keeping this software upto date. This program is not essential to the running of the system
HPHmon06>>>Related to the Hewlett Packard software HP Photosmart printer, it provides easy access to flash card reading functions. This program is not essential to the running of the system. Your choice.
iTunes
iPod
RoboForm>>>Roboform - password manager and web form filler. Will work without this startup entry, as the "active" component is an integrated Internet Explorer browser plugin
Adobe Gamma Loader>>>Adjusts monitor colours across all programs, including Photoshop. It is needed by some graphics professionals who want their monitor calibrated. Most home users will not need it. In my case I can verify this as Photoshop loads fine
Adobe Reader Speed Launch>>>supposedly speeds the loading of the Adobe Reader, makes very little difference in the speed of the load of the program, turn it off.

Because Windows XP has to be all things to all people it has many services running that take up system resources that you will never need. Here also is a list of items (taken from ~TL's link How to configure Windows Services in XP) which you can either disable or set to manual using the Services section of Administrative tools. I have listed the entries and the recommended setting in order to speed up the computer;

Go to Start, Control Panel, Adminstrative Tools, Services;
The following entries can usually be disabled or set to manual, not all entries will be found on every machine, if you don't find it in yours don't worry about it, just double click on each of the listed and the configuration box will open for you to change the settings;
Alerter>>>disabled
Application Layer Gateway Service>>>manual
Automatic Updates>>>disable. Be sure to do these manually however.
Background Intelligent Transfer Service>>>Manual
Clipbook>>>disable
COM+ Event System>>>disable
COM+ System Application>>>disable
Computer Browser>>>manual
Distributed Link Tracking Client>>>disable
Distributed Transaction Coordinator>>>disable
Error Reporting Service>>>disable
Fast User Switching Compatibility>>>if you are the only user of thecomputer then disable
Help and Support>>>disable...this will change itself to automatic every time you use it so be sure to go back and reset to disable if you do use this.
Human Interface Device Access>>>manual
Indexing Service>>>a HUGE resource hog...disable
IPSEC Services>>>disable
Logical Disk Manager>>>if you do not plan to add additional hard drives you can disable this one.
Logical Disk Manager Administrative Service>>>same as above
Messenger>>>this is NOT MSN Messenger it is Windows Messenger>>>This service was originally made for administrators to send you messages over the network. This service is now being exploited by spammers to send you popup messages from over the Internet! Disable it
MS Software Shadow Copy Provider>>>manual
Net Login>>>manual
NetMeeting Remote Desktop Sharing>>>disable
Network DDE>>>disable
Network DDE DSDM>>>disable
Network Location Awareness (NLA)>>>manual
NT LM Security Support Provider>>>disable
Performance Logs and Alerts>>>disable
Portable Media Serial Number>>>disable...Retrieves serial numbers from portable music players connected to your computer. Disable it unless something of yours ceases to function properly afterwards this a privacy risk, as it will be contacting a server on the Internet and telling them what music you listen to.
QoS RSVP>>>disable...can cut your bandwidth speed down 20%
Remote Desktop Help Session Manager>>>disable
Remote Procedure Call (RPC) Locator>>>disable
Remote Registry Service>>>This allows remote users access to your registry!>>>disable
Routing and Remote Access>>>disable
Secondary Logon>>>disable
Security Accounts Manager>>>a security risk and should be>>>disable
SSDP Discovery Service>>>even Microsoft says this is a security risk>>>disable
System Event Notification>>>disable
TCP/IP NetBIOS Helper Service>>>disable
Telnet>>>big security risk as it can allow users access to your system remotely>>>disable
Terminal Services>>>disable
Uninterruptible Power Supply>>>manual
Universal Plug and Play Device Host>>>disable
Volume Shadow Copy>>>disable
WebClient>>>disable
WMI Performance Adapter>>>manual

Once you have completed all the above, reboot the computer. See if it is running any better...hopefully it does.
Judy