what are the specs? ( processor, memory and type, hard drive )
if something like that happened to me, i would probably quickly make a back-up of all my important documents, then just re-install the o/s.
windows me is notorious for being buggy, so if you possibly can, move up to windows xp.
if you do just re-install windows me, ... or if you upgrade to windows xp, make sure you boot from the cd, and delete your old partition when the menu comes up.
this will assure that your drive gets completely reformatted before it installs the new o/s.
i think my most important advice here is make a back-up while you still can
if a re-install of the o/s doesn't fix it, then it's most likely you have hardware issues. ( hard drive, or memory maybe )
this is all just guesses, and how i might troubleshoot my own system .. dont' take it as dead set on by any means.