WLM Crashes after login

I have Windows XP SP2 with all latest updates. The Windows Live Messenger was
working fine till i installed IE7. Because of a bugcheck i had to uninstall
IE7 after which i am not able to use Windows Live Messenger. I have tried
re-installing it atleast 3 times but to no avail. I also have Bit Defender
Internet Security v10 installed in my machine. Now the Windows Live Messenger
crashes whenever i try to login. I
have tried deleting the files in Local Settings -> App Data-> Microsoft ->
Windows Live Contacts etc.
The version i am using is 8.0.812.
This is the error signature:
AppName: msnmsgr.exe AppVer: 8.0.812.0 AppStamp:44cc1896
ModName: msvcrt.dll ModVer: 7.0.2600.2180 ModStamp:41109752
fDebug: 0 Offset: 00036fa3

Any workarounds or fixes or suggestions are welcome.
P.S: I posted it as comment in a different thread, now posting as question
with more details. Sorry for the repost.