Alienware M17X-R2 crashing/freezing issue with windows update

My M17X-R2 has recently been freezing up, bluescreened or just straight up crashed shortly after I log in. It all happens after I run windows update (and sometimes after I try to update the graphics drivers). I've ran a memory check, no problems detected. Harddrives seem to work fine as I'm able to format them and use them as normal. I can play games just fine for the brief periods that it works after running alien respawn, so I doubt the graphics cards are broken.

As mentioned the computer works fine after running alien respawn and restoring it to factory settings, but as soon as I update the graphics drivers or run windows update it all goes south. It sometimes freezes when applying the updates upon computer restart, but always freezes/crashes/whatever when I log in after the update.

After uninstalling my graphics drivers (again) and trying to run a system restore I've encountered a new problem; as soon as windows loads I get a black screen where the login screen would normally be. I can see my mouse but the computer freezes before I can do anything and stays like that indefinitely.

My computer worked fine with the latest ATI drivers a few weeks ago, and then one day it just didn't.
The computer always works perfectly fine in safe mode, so based on that and the tests I've run on my hardware I'm assuming it's a software problem. But I'm completely clueless as to what is causing it. I refuse to run without windows update and with old graphics drivers after paying this much money for a computer that is supposed to be top of the line. I want to fix this but I am running out of ideas as to what to do, any help provided would be much appreciated. 

• I've tried restoring the system to an earlier point when it worked, and it sometimes works and sometimes tells me that the restore point doesn't work or something. Doesn't feel like a permanent solution to my problem anyway as when it does work it'll just stop working again after running windows update.
• I've ran alien respawn several times, the computer will work fine now untill I run windows update or update my graphics drivers.
• I've tried repairing windows with a DVD that I have, no differance at all.
• I've updated my bios to the latest version available from Dell's website, seemed to work for a bit. I managed to manually run windows update and install the lasted graphics drivers and successfully restarted the computer several times with no problems. After leaving the computer turned off over night and then back on the next day the problems returned.
• I've tried several different versions of my graphics drivers, including the default ones that came with the computer, the latest version on Dell's website and the latest version from ATI's website. Only the default ones seem stable, but they're terrible for performance.
• I've tried turning off all my autostart applications in msconfig, no differance.