sound goes off

PC Specs:

CPU: INTEL Core 2 Duo E7500, 2.93GHz, 1066Mhz, s775, 3MB Tray
MotherBoard: ASUS P5QPL-AM s775 C2Q 1333Mhz, Intel G41, DDR2 800, PCI-E, HDAudio
HD: Seagate Barracuda 500GB
Graphics: ATi Radeon HD 5670 1GB GDDR5 DX11 PCI-E
Memory: 4GB Kingston 800Mhz
O/S: Windows XP Professional SP3

I'm not sure if its related to my soundcard (onboard) but the problem is that my sound is going off every time I turn on my PC.. I can get sound for like the first 40 seconds and every program that I manage to run during those seconds remains with the sound on till I shut it down.

e.g. if I wanna listen to Youtube then I have to launch my browser during those ~40 seconds, if I do it later then I gotta reboot and try again to open what ever I can during this time.. also, the windows appearance is changing to the old style and there's an error appearing "Generic Host Process for Win32 Services" a bit earlier to the sound issue, like 10 sec earlier.. might be related..

I've tried system-restore, also tried to re-install the sound drivers, I've also got many spyware/maleware removers and some AVs and done many scans, none of them worked.. I can't even format cause my CD-ROM isn't working... as a final solution, is there a way to format using a USB? I got a XP SP3 ready on a USB but I'm not sure its do-able..

so, any help would be much appreciated!