Told you I'd get bored and fix it... I think I finally have the whole thing removed, it was hiding pretty well, none of the standard software could detect it (malewarebytes etc)
My solution to keep people off IE is a little less eloquent

I just told it to use a proxy and set that to 0.0.0.0 so now it just won't connect to the internet ^_^
Bleh I'm an idiot and forgot MSN uses that too... hmm I'm not too sure how to even accomplish your method... I don't do too much networking stuff (and ours is just set up like a home network since it's only a couple computers)
Install Apache Web server on one of the computers and then make my file the index.html file in the www folder. Set it as the home page for IE on all the computers. Then, for Firefox, use Public Fox to restrict what crap they can download
Using my not considerable knowledge about computer software, sounds like you were pressing "I'm Feeling Lucky" on http://www.youtube.com/user/QuoteClip#p/u/62/NhQ0DibXdHU.
Nope. It's called http://en.wikipedia.org/wiki/Dns_poisoning
Avast! is better... it has internet security.
While Avast! does provide much better protection (I use it solely for the script and web shield) it does have a higher false positive rate than MSE. Personally I think for actually being a proactive AV (MSE is merely reactive offering only basic real-time scanning) it is worth it, but I can see how others may not.
Avast! isn't free and from what my dad has told me(who as far as I'm concerned is the Greek god of the computer) there isn't really much difference between any of the antivirus programs.
Avast! 4 Home is free for home use, and different AVs are most definitely not equal, most aren't even in the same ballpark as any given other one.
Viruses don't just jump on your computer. There is always a rational explanation - to everything. Common sense is the best anti-virus they say, and it's right. I haven't had a single virus in my life thanks to smart use. No clicking popups, no opening suspicious e-mails, stick to popular sites if there are plenty to choose from. Download only certified items you know other people are using.
You may be correct for plain old viruses, but for other malware, such as worms, you can get infected very easily following common sense as it uses security holes to infect you with no user interaction, same for cross-site-scripting. Common sense isn't enough any more in the modern Internet
Of course there is the possibility of hijack, website security breach and the like but 99 out of 100 it's because of user stupidity. But good stupidity mind you, as it means easy money to the experts!
You seriously underestimate malicious ads, cross-site-scripting, driveby downloads, and unpatched security holes.
Back when this site was hacked, if a malicious script was added that would silently execute code on your computer, would you have been able to recover? Probably not if you have no AV. It's happening all the time, and to big-name sites like http://www.pcworld.com/businesscenter/article/240609/mysqlcom_hacked_to_serve_malware.html and cause tens of thousands of people to get infected before it is found out. It's no longer 99 out of 100 the fault of the user, unless you expand user stupidity to include "people who think they are secure with just common sense".
Reformat is the best antivirus program anyway.
:nod: Nothing like restoring a hard drive image and be back up and running to a 100% clean PC in under 30 minutes.