I've never encountered this before, and haven't a clue where to start looking. I recently worked on an HP system with Media Center, and wound up performing a "restore" - meaning HP style, where data is left intact but the PC is returned to a factory state.
I can't believe that from the factory, SYSTEM would appear to use 100% of the CPU's time. I say "appear" because the interface is generally responsive, but boot time is much slower than it should be and certain operations take much longer - for example, the desktop takes a long time to load after login.
Safe mode gets rid of the problem, VGA mode does not. Hardware tests were all successful. I'm wondering if it's remnants of the Norton Security Suite or some other application with kernel-level privileges, but I was loathe to remove anything without more information.
Anyone encountered such a phenomenon, or have suggestions on what to look at? I did not have time to perform full clean-boot troubleshooting, as I was onsite at a client's residence, making time a commodity. Maybe I should have taken more time, because now it looks like a return trip is in order, but I would hate to go with no additional knowledge!!