To resolve this error, you need to use the Recovery Console (RC) to replace the ntfs.sys file by performing the following steps:
1. Insert the XP installation CD-ROM and reboot your machine.
2. When the installation menu appears, press the R key to start an RC session.
3. When prompted, select the installation and enter the Administrator password.
4. At the console, navigate to the system32\drivers folder, assuming your Windows folder is called "windows," by typing
cd \windows\system32\drivers
5. Rename the current ntfs.sys file by typing
ren ntfs.sys ntfs.bad
6. Copy the ntfs.sys file from your installation CD-ROM to your current location by tying
copy :\i386\ntfs.sys .
Be sure you include the period at the end of the command to instruct your system to use the current location.
7. Remove the XP installation CD-ROM, then restart your machine.
Thats what google got me.
Edit: appears its fubarred