Nasty Computer Virus?

A few weeks ago, while playing around on Facebook, my computer popped up with a System Message from my AVG Anti-Virus claiming to be moving a threat to the Virus Vault. I allowed it, as I had many times before. Only this time a message popped up on my computer saying that Windows needed to force shutdown in order to save itself from damage. Instant blue screen and reboot. When it came back my computers theme was no longer the newer Windows 7, but something older. I’ve also lost my wireless connection. The computer doesn’t pick up my router at all. I tried System Restore…it won’t work. I get a message saying there’s something wrong with it. Same thing with Backup. I get an error message saying it isn’t working. I am sure I have a fairly bad virus, I did scan my computer through AVG and pick up 5 Trojans..all were removed, but this didn’t fix my computer. Several other programs and files also won’t work. I also tried attempting System Restore through Safe Mode. Same error message. Is it PC Tech time???
Anyone heard of this or know what I can do to save my computer? I can’t reinstall Windows or do System Image when my computer won’t allow Backup to run.
Any help is greatly appreciated.