loginwindow process not responding - erase and install does not help

A couple of days ago i ran into some problems with my macbook (version 3,1). some processes are not responding (loginwindow and systemuiserver), apple menu items are not responding (meaning no shutdown or restart) and i get a 10+ min. blue screen on startup.

Safe mode looks ok (except no sound - that could be some other issue) and testing with leopard disk shows no hardware errors and no problems with disk permissions.

NOW! the big problem is that i tried to reinstall the OS using erase and install with different startup disks (leopard and snow leopard) and the problem persists. I mean i deleted every inch of the hard drive (including efi - ??) with no results.
Still safe mode works well. I tried some tricks i found on forums (like deleting startup items - i have no startup items (!?), and deleting com.apple...plist file) but none seemed to work.

note: my guess is that it's a network issue as i was just copying some stuff from a local network (my linux desktop).

second note: this guy's post is similar (but without the erase and install stuff). http://forums.macrumors.com/showthread.php?t=793654

any guess anyone ???

 

thanks for the advice.
i have no outside hardware or peripheral.
but I'll try it out.

 

Nope! Not the RAM.
Now I installed Windows XP and it's running great. That's kind of ironic...