We have had many Startup repair loop type of problems. Often, they seem to occur for no apparent reason, such as yours. Since they can be caused by several different situations, there is no, as far as I know, definite answer about how to get the system back, other that a reinstall.
In your instance, the error mentions a bad patch. This is probably referring to a Windows update, but hard to know for sure. If you had seen Windows Update mention the SP1 update, it might give us a clue.
It should also be noted, a Startup Repair may take several attempts to repair a problem, if it can. So if the system has not rebooted several times, you might try again.
Sometimes it is hard to get the F8 key to respond, unless you tap it vigorously during boot. But I had the loop once and could never get the system to break out of the loop. If you can shut the system down for a while, and reboot later, it may even help.
If you do not have the Windows Install DVD, you can download one and try using it to get into the Windows repair environment. But you need to get someplace like a command prompt, where you can look at your system and possibly run some command line utilities to attempt a repair. It is SP1, so you may not be able to reinstall using it if you have an OEM version of the software.
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If you decide to reinstall, and have data you want to save, using a Linux boot flash drive, like Ubuntu is very convenient for transferring data to another drive. You manufacturer may have a way to restore that will not clear out your data..not sure.