Odd Issue On A Compaq EVO 500 SFF

Having an odd issue on a Compaq EVO 500 SFF

System seems to think it is part of a network with some form of user/group
policy restrictions applied.

Running Windows XP Home
Owner is not a tinkerer and has no idea how any restrictions could have been
applied to her PC.
Owner only noticed something was odd when the clock didn't update to DST.
No longer has access to control panel and several other of the usual
restrictions one might find on a company PC.
While the machine was once part of a corporate network it was purchased sans
HD and had a new 80 GB HD installed with a fresh install of Windows XP
(updated to SP2).
When I first tried to check, could not log-in to the Admin account.
Used Log-in recovery and passwords for Admin and User account came back both
as "blank"
Logging in as Admin doesn't have any more access rights than the user
account.
Tried to locate "GPEdit" to see what was up, but was not found on the
system.
Not sure what the owner could have done to precede this.
Also noted that access to the Windows Update site is disallowed.
Software includes: Adware, Spybot and Norton Internet Security
Suggestions???