this is the HJT log i have, avg has found a Trojan horse Java/ClassLoader

Logfile of HijackThis v1.99.1
Scan saved at 00:29:51, on 14/06/2007
Platform: Windows XP SP2 (WinNT 5.01.2600)
MSIE: Internet Explorer v7.00 (7.00.6000.16473)

Running processes:
C:\WINDOWS\System32\smss.exe
C:\WINDOWS\system32\winlogon.exe
C:\WINDOWS\system32\services.exe
C:\WINDOWS\system32\lsass.exe
C:\WINDOWS\system32\svchost.exe
C:\WINDOWS\System32\svchost.exe
C:\WINDOWS\system32\spoolsv.exe
C:\WINDOWS\Explorer.EXE
C:\Program Files\Grisoft\AVG Anti-Spyware 7.5\guard.exe
C:\PROGRA~1\Grisoft\AVGFRE~1\avgamsvr.exe
C:\PROGRA~1\Grisoft\AVGFRE~1\avgupsvc.exe
C:\PROGRA~1\Grisoft\AVGFRE~1\avgemc.exe
C:\Program Files\Digital Media Reader\shwiconem.exe
C:\Program Files\CyberLink\PowerDVD\PDVDServ.exe
C:\Program Files\Common Files\New Boundary\PrismXL\PRISMXL.SYS
C:\WINDOWS\System32\PAStiSvc.exe
C:\WINDOWS\system32\svchost.exe
C:\WINDOWS\system32\hkcmd.exe
C:\WINDOWS\system32\igfxpers.exe
C:\WINDOWS\zHotkey.exe
C:\WINDOWS\RTHDCPL.EXE
C:\PROGRA~1\Grisoft\AVGFRE~1\avgcc.exe
C:\Program Files\Java\jre1.6.0_01\bin\jusched.exe
C:\Program Files\Grisoft\AVG Anti-Spyware 7.5\avgas.exe
C:\WINDOWS\system32\ctfmon.exe
C:\WINDOWS\System32\svchost.exe
C:\WINDOWS\system32\wscntfy.exe
C:\Program Files\NETGEAR\WG111v2 Configuration Utility\RtlWake.exe
C:\Program Files\NETGEAR\WG111v2 Configuration Utility\RtWLan.exe
C:\Program Files\Internet Explorer\iexplore.exe
C:\Program Files\hijackthis\hijackthis\HijackThis.exe

R1 - HKCU\Software\Microsoft\Internet Explorer\Main,Search Bar = http://g.msn.co.uk/0SEENGB/SAOS01?FORM=TOOLBR
R1 - HKCU\Software\Microsoft\Internet Explorer\Main,Search Page = http://g.msn.co.uk/0SEENGB/SAOS01?FORM=TOOLBR
R0 - HKCU\Software\Microsoft\Internet Explorer\Main,Start Page = http://www.google.co.uk/
R1 - HKLM\Software\Microsoft\Internet Explorer\Main,Default_Page_URL = http://go.microsoft.com/fwlink/?LinkId=69157
R1 - HKLM\Software\Microsoft\Internet Explorer\Main,Default_Search_URL = http://go.microsoft.com/fwlink/?LinkId=54896
R1 - HKLM\Software\Microsoft\Internet Explorer\Main,Search Page = http://go.microsoft.com/fwlink/?LinkId=54896
R0 - HKLM\Software\Microsoft\Internet Explorer\Main,Start Page = http://go.microsoft.com/fwlink/?LinkId=69157
R1 - HKCU\Software\Microsoft\Internet Explorer\SearchURL,(Default) = http://g.msn.co.uk/0SEENGB/SAOS01?FORM=TOOLBR
R1 - HKCU\Software\Microsoft\Internet Connection Wizard,ShellNext = http://www.uk.emachines.com/
O2 - BHO: Adobe PDF Reader Link Helper - {06849E9F-C8D7-4D59-B87D-784B7D6BE0B3} - C:\Program Files\Adobe\Acrobat 7.0\ActiveX\AcroIEHelper.dll
O2 - BHO: (no name) - {53707962-6F74-2D53-2644-206D7942484F} - C:\Program Files\Spybot - Search & Destroy\SDHelper.dll
O2 - BHO: SSVHelper Class - {761497BB-D6F0-462C-B6EB-D4DAF1D92D43} - C:\Program Files\Java\jre1.6.0_01\bin\ssv.dll
O2 - BHO: (no name) - {7E853D72-626A-48EC-A868-BA8D5E23E045} - (no file)
O2 - BHO: EpsonToolBandKicker Class - {E99421FB-68DD-40F0-B4AC-B7027CAE2F1A} - C:\Program Files\EPSON\EPSON Web-To-Page\EPSON Web-To-Page.dll
O3 - Toolbar: (no name) - {BA52B914-B692-46c4-B683-905236F6F655} - (no file)
O3 - Toolbar: EPSON Web-To-Page - {EE5D279F-081B-4404-994D-C6B60AAEBA6D} - C:\Program Files\EPSON\EPSON Web-To-Page\EPSON Web-To-Page.dll
O4 - HKLM\..\Run: [NeroFilterCheck] C:\WINDOWS\system32\NeroCheck.exe
O4 - HKLM\..\Run: [SunKistEM] C:\Program Files\Digital Media Reader\shwiconem.exe
O4 - HKLM\..\Run: [RemoteControl] "C:\Program Files\CyberLink\PowerDVD\PDVDServ.exe"
O4 - HKLM\..\Run: [High Definition Audio Property Page Shortcut] HDAShCut.exe
O4 - HKLM\..\Run: [AzMixerSel] C:\Program Files\Realtek\InstallShield\AzMixerSel.exe
O4 - HKLM\..\Run: [IgfxTray] C:\WINDOWS\system32\igfxtray.exe
O4 - HKLM\..\Run: [HotKeysCmds] C:\WINDOWS\system32\hkcmd.exe
O4 - HKLM\..\Run: [Persistence] C:\WINDOWS\system32\igfxpers.exe
O4 - HKLM\..\Run: [CHotkey] zHotkey.exe
O4 - HKLM\..\Run: [RTHDCPL] RTHDCPL.EXE
O4 - HKLM\..\Run: [Alcmtr] ALCMTR.EXE
O4 - HKLM\..\Run: [AVG7_CC] C:\PROGRA~1\Grisoft\AVGFRE~1\avgcc.exe /STARTUP
O4 - HKLM\..\Run: [EPSON Stylus D88 Series] C:\WINDOWS\System32\spool\DRIVERS\W32X86\3\E_FATIABE.EXE /P23 "EPSON Stylus D88 Series" /O6 "USB001" /M "Stylus D88"
O4 - HKLM\..\Run: [Sony Ericsson PC Suite] "C:\Program Files\Sony Ericsson\Mobile2\Application Launcher\Application Launcher.exe" /startoptions
O4 - HKLM\..\Run: [SunJavaUpdateSched] "C:\Program Files\Java\jre1.6.0_01\bin\jusched.exe"
O4 - HKLM\..\Run: [!AVG Anti-Spyware] "C:\Program Files\Grisoft\AVG Anti-Spyware 7.5\avgas.exe" /minimized
O4 - HKCU\..\Run: [ctfmon.exe] C:\WINDOWS\system32\ctfmon.exe
O4 - HKCU\..\Run: [MsnMsgr] "C:\Program Files\MSN Messenger\MsnMsgr.Exe" /background
O4 - Global Startup: Install Pending Files.LNK = C:\Program Files\SIFXINST\SIFXINST.EXE
O4 - Global Startup: WG111v2 Smart Wizard Wireless Setting.lnk = ?
O8 - Extra context menu item: Add to Windows &Live Favorites - http://favorites.live.com/quickadd.aspx
O8 - Extra context menu item: E&xport to Microsoft Excel - res://C:\PROGRA~1\MICROS~2\Office10\EXCEL.EXE/3000
O9 - Extra button: (no name) - {08B0E5C0-4FCB-11CF-AAA5-00401C608501} - C:\Program Files\Java\jre1.6.0_01\bin\ssv.dll
O9 - Extra 'Tools' menuitem: Sun Java Console - {08B0E5C0-4FCB-11CF-AAA5-00401C608501} - C:\Program Files\Java\jre1.6.0_01\bin\ssv.dll
O9 - Extra button: (no name) - {e2e2dd38-d088-4134-82b7-f2ba38496583} - %windir%\Network Diagnostic\xpnetdiag.exe (file missing)
O9 - Extra 'Tools' menuitem: @xpsp3res.dll,-20001 - {e2e2dd38-d088-4134-82b7-f2ba38496583} - %windir%\Network Diagnostic\xpnetdiag.exe (file missing)
O9 - Extra button: Messenger - {FB5F1910-F110-11d2-BB9E-00C04F795683} - C:\Program Files\Messenger\msmsgs.exe
O9 - Extra 'Tools' menuitem: Windows Messenger - {FB5F1910-F110-11d2-BB9E-00C04F795683} - C:\Program Files\Messenger\msmsgs.exe
O11 - Options group: [INTERNATIONAL] International*
O16 - DPF: {02BF25D5-8C17-4B23-BC80-D3488ABDDC6B} (QuickTime Object) - http://a1540.g.akamai.net/7/1540/52/200612...ex/qtplugin.cab
O16 - DPF: {0EB0E74A-2A76-4AB3-A7FB-9BD8C29F7F75} (CKAVWebScan Object) - http://www.kaspersky.com/kos/english/kavwebscan_unicode.cab
O16 - DPF: {8E0D4DE5-3180-4024-A327-4DFAD1796A8D} (MessengerStatsClient Class) - http://messenger.zone.msn.com/binary/Messe...nt.cab31267.cab
O18 - Protocol: livecall - {828030A1-22C1-4009-854F-8E305202313F} - C:\PROGRA~1\MSNMES~1\MSGRAP~1.DLL
O18 - Protocol: msnim - {828030A1-22C1-4009-854F-8E305202313F} - C:\PROGRA~1\MSNMES~1\MSGRAP~1.DLL
O20 - Winlogon Notify: igfxcui - C:\WINDOWS\SYSTEM32\igfxdev.dll
O20 - Winlogon Notify: WgaLogon - C:\WINDOWS\SYSTEM32\WgaLogon.dll
O21 - SSODL: WPDShServiceObj - {AAA288BA-9A4C-45B0-95D7-94D524869DB5} - C:\WINDOWS\system32\WPDShServiceObj.dll
O23 - Service: AVG Anti-Spyware Guard - GRISOFT s.r.o. - C:\Program Files\Grisoft\AVG Anti-Spyware 7.5\guard.exe
O23 - Service: AVG7 Alert Manager Server (Avg7Alrt) - GRISOFT, s.r.o. - C:\PROGRA~1\Grisoft\AVGFRE~1\avgamsvr.exe
O23 - Service: AVG7 Update Service (Avg7UpdSvc) - GRISOFT, s.r.o. - C:\PROGRA~1\Grisoft\AVGFRE~1\avgupsvc.exe
O23 - Service: AVG E-mail Scanner (AVGEMS) - GRISOFT, s.r.o. - C:\PROGRA~1\Grisoft\AVGFRE~1\avgemc.exe
O23 - Service: PrismXL - New Boundary Technologies, Inc. - C:\Program Files\Common Files\New Boundary\PrismXL\PRISMXL.SYS
O23 - Service: STI Simulator - Unknown owner - C:\WINDOWS\System32\PAStiSvc.exe

any help please

Nothing is showing in your HJT log. What file (full path and name) did AVG detect?

it found

C:\Documents and Settings\merrells\Application Data\Sun\Java\Deployment\cache\javapi\v1.0\jar\crtdcghcn.jar-3864182a-6b 15c20b.zip

i dont know if there is a space between 6b and 15c hard to tel. there must be something as my comp is slow on boot but i have hardly anything on here and run daily programmes, lavasoft, avg, spybot etc.

Looks like a temporary file in the Java cache. You can just delete it, if its still there. Nothing to worry about.

java settings?

i have gone inot java and cleared temporary files under the general tab and temporary files settings.
what about the virus avg says it is still holding in the vault?
would i leave this in there or empty it?

The vault is protected storage that your AV uses to hold a file detected as bad. Unless its an valid file detected in error, there is no reason to keep anything in the vault. Go ahead and delete it.