WGA and PC reboot-loop epidemic - connection?

Not pointing any fingers but I want to throw this out there cuz I'm exausting
all other possibilities.

I'm part owner in a computer company. Lately it seems every PC we build and
send out is coming back with a problem - WinXP will boot to the splash
screen, then restart, continuously ... forever actually.

At first we thought they dl'd a virus or hosed Windows by doing something
like powering off with the power button but we graciously re-installed their
Windows again for them "just this once".

Then after 3 out of 4 new builds came back ... we really started wondering.
Seemed a bit coincidental that they were all downloading the same virus. I
ran diagnostics on the hard drive of one - I/O errors. Oh, okay, har drive
is bad. Ran diagnostics on them all after that ... all with I/O errors.
Okay, must've gotten a bad batch of hard drives from our supplier.

Replacing hard drives even with other makes and models of drives ... same
problem. o.O Flashed the BIOSes, swapped a couple of motherboards ... still
the same problems (not to mention this is the 3rd or 4th trip back to us with
their "new pc" and they're beyond steamed).

THEN we started getting PCs coming in with the exact same problems that
weren't OUR builds ... Dells, HPs, Gateways ... all kinds, all different
drive brands, SATA and IDE, different motherboards, different chipsets,
different processors, different software installed, different ISPs and emails
.... no rhyme or reason it seems. Well for the last week of this epidemic it
seems that I've narrowed it all down to the only factors that were common to
every one of these computers:

1) all have exact same reboot loop problem
2) all have WinXP (though there's been both Home and Pro)
3) all started about a week and a half ago
4) all have their Windows Updates including the new "Validate-me-first!"
version, fully up-to-date either by automatic updates, doing it themselves
recently, or me fully updating their new install before sending it out the
door

So while I don't "know" (which is why I'm here picking your brains), at this
point I can only see two possibilities:
a) the newest Windows Update is screwing up Windows installs
b) there's a new virus that's very nasty and very widespread and yet no AV
company seems to know about it yet. o.O

Anyone else having this reboot loop problem? ANyone have any ideas or
clarifications on what it could and could not be?

Thanks in advance.

P.S. Sorry, forgot to mention that while I know there's a "SP2 reboot loop"
issue, I don't think this is the same because everything's been fine with all
other builds, installs, repairs, etc until about a week, week and a half ago
when I first saw the "You must validate Windows first" thingy. So I doubt
it's SP2 specific.