Many current malware are removing the option in the registry to properly enter Safe Mode. This is in an attempt to make removal of the malware more difficult. Once you have forced Windows to boot to Safe Mode using the /Safeboot option in the System Configuration Utility (MSCONFIG), this is forcing Windows to boot to an option that simply doesn't exist because MSCONFIG has placed a /safeboot entry in the Boot.ini file and it cannot be removed until you can get back to MSCONFIG to uncheck the Safeboot option. You will now be stuck booting to your boot options screen as you've described.
A possible fix for this is to rename your Boot.ini file so that Windows can identify that it doesn't exist and automatically rebuild it. Here's how:
1. Boot Windows from your Windows installation CD
2. Enter the Recovery Console (How to use the Recovery Console)
3. Once you've entered the command prompt, rename the Boot.ini file by entering the following:
ren C:\Boot.ini Boot.ini.old
4. Press Enter
5. Once the renaming has been successful, remove the installation CD and try booting your system normally.
6. When you have successfully entered Windows, rename the file back to Boot.ini using your command prompt. (Start>> Run>> Type in: cmd [Enter])
7. Go back to MSCONFIG (Start>> Run>> Type in: msconfig [Enter]). Once in the System Configuration Utility, click the Boot.ini tab and deselect the /SAFEBOOT option.
8. Exit the System Configuration Utility.