I hate to say it but buy them a mac mini or something, it's less easy for people to screw them up because account restrictions work much better, limited accounts on XP don't do much. Otherwise make them a limited account sign them up for a legal music service, and tell them to rent movies. The biggest problem I see on peoples computers is filesharing when they have no clue what there doing. File sharing could be defined as a lazy mans way of spreading a virus, if you know to scan files and not download exe movies it might be fine, but the average user doesnt know what an exe is and doesn't want to know.
Deleting the windows directory is a bad idea let them know that. Were they actually running low on space or did they just think so? I've seen people claim to be running out of space while only using a small fraction of their hd.
Bitcomet is a bittorrent client, read up on it if you don't know what it is.
Another advantage to having unknowledgable users having a mac is less software compatibility, hence less possible harm you can't deny that
Anyways to fix your problem without a reinstall, throw in the XP cd, and when it shows u ur current windows partition hit R, it'll run a repair install, replacing system files etc, and often fixes issues like that.