I just had a wonderful time trying to rid a PC of this pain in the butt.  Turns out, the fix is pretty simple.
Download Process Explorerhttp://www.sysinternals.com/ntw2k/freeware/procexp.shtml
Open Hijack This and Process Explorer.
Stop explorer.exe thru Process Explorer.
Scan with HJT, fix the problems.
Delete Nail.exe thru Process Explorer (File, Run, Del c:\Windows\Nail.exe...  
Restart PC...
Seems to have gone away for me.  Hope yall can benefit from this.