Video Driver failed to initialize [Home 32bit]

I think this is the right section. I did some searching but didn't find anything to help me.

My PC was working fine yesterday morning. I then went to work and came back, turned it on and it doesn't boot. It gets to the vista loading bar then goes black and restarts. It comes up with the startup repair but that cannot fix it. I can't boot in any mode at all. When I've disabled restarting when there is a crash I get to a blue screen which says :

"The video driver failed to initialize

STOP: 0x000000B4 (0x8747F008, 0x87009000, 0x86EDE00, 0x00000000)"

Ive tried running many tests but none of them find a solution. I even tried running a Live CD of Ubuntu so that I could actually boot up but that also fails. I can't think of much else to do. I can restore it back to factory settings but I will lose all my files.

PC Specs
2GB RAM
ATI 1300/1550 series

Any solutions?
If you need anymore information just ask.

Thanks in advance, Mattie.