Got me with what March A or MATS is supposed to mean.
Quackshot offers some good advice, especially about drivers and possible incompatability in the memory. Like I said, one time I did have a problem with 2 One gig sticks from Crucial not working together but working fine when used alone. I called them, they looked at the particular MotherBoard series and found that there was a problem with that series. They gave me a full credit for the one stick I returned. Have you asked Crucial about your situation?
I do not use Hibernate after one experience where it caused me some problems so I do not have any real help to offer in that area.
What Quackshot mentioned about a BIOS Update may cure the problem but be careful if you try to flash the bios. A failure here could cause a number of problems. If you do try, see if you can get a UPS to insure that a random power failure or blip doesn't happen while you are flashing.
It would appear that, if each DIMM when used separately one at a time in either slot,indicates 1 Gig, the DIMM is okay and the slot is okay. That would seem to indicate either a software error in the bootup process or a impending or intermittent hardware failure.
If you have not checked the BIOS reading for RAM, it might be a good thing to look. If the BIOS shows 2 Gig when both DIMMs are installed but XP only shows one Gig, suspect XP, possibly a driver conflict or MB problem. That was one of my major clues when I had the problem I mentioned.
With what you have said, especially about the restart not starting, I suspect something may have got added or changed without your knowledge.
I am not a fan of "Restore" but did you perhaps try a Restore to an earlier date, when the system first acted up? It is probably too late to gain anything from trying a restore now.
Have you tried "Safe Boot"? (Hold the F8 key during the boot process and then select Safe Boot.)
This will start with a reduced set of drivers and if a driver conflict is causing the problem you may start normally. You will have to select your operating system from the choices. If you see anything else besides your XP-SP3 something is happening that probably shouldn't. Again check RAM (Start/Settings/CP/......)
You should choose to login as your account since the Administrator account will probably also be shown as a login choice. This is the account that is set up when XP is first installed. I presume that it will still be offered with the Dell installed Windows. If it is password protected and you do not know/remember the password, try administrator or Administrator (note case change since the PW is case sensitive.)
After you are booted up, RIGHT click on the "Start" button. This should pull up a menu with "Explore all users" When you click on it, a window should open showing a list of all the programs that are configured to be in the "All Programs" list. One of the entries will also be "Startup". Take a look at the "Startup" entries. If you see some program(s) that do not seem to be things you willingly installed, they probably came along when you downloaded something or maybe did an update. Do not remove them yet but note them.
Repeat this process but using your account instead of the "All Users" to see what programs are trying to start automatically when you log in. There may be some conflict with one or more of the programs, especially is there is something that is "supposed" to "speed up your system" or some such advertising BS.
Again, to re-quote Quackshot "Number Six, you may have a hardware problem where something has, or is about to fail.
Number seven, good luck! "