Okay, first, the specs of the machine:
MBO: Asrock AM2XLI-ESATA2 (crap mobo I know, no need to tell me that)
CPU: AMD Athlon 64X2 6000+
RAM: 3GB Crucial
GPU: ATI Radeon 3850 512mb
PSU: Corsair VX450
OS: Windows XP SP3 (OHNOES HE USES AN OLD OS IT IS SUK BLA BLA USE WINDOWS 7 WEEE I AM A WALRUS AND I HAVE A SEXY MOUSTACHEZ YAAAAY - now that we got over the fact that the W7 is better os than XP, so can we carry on with the program please? Thanks.)

Now the problem:

When I power on the computer, it boots normally, everything is fine, but after 5 minutes or an hour it will frezze.

When it freezes, one of the following will happen:
1. Freeze. Image stays on the screen. LED's on my mouse and keyboard stay lit, have power, but the computer does not react. to keypressess or moving the mouse. Only reboot button helps.
2. Freeze. Image stays for a couple seconds with black screen afterwards. LED's on mouse unlit, keyboard lit, computer doesn't react to mouse movement or to keyboard.
3. Freeze. Black screen followed by BSOD that points to ati2dvag STOP error. Mouse and keyboard don't react.(DUH)

And now here's the funny part: When I reboot the computer after one fo these happen, it works normally until I shut it down, and when I mean normally I mean there are no errors in games, no artifacts in any game or other graphical glitches, no problems encoding video, no problems with temperature, not a single one. That is until I shutdown the computer, where upon the freezing cycle will repeat after powering it on the next day.

What I did so far: Reinstalled windows, memtested the ram, tried removing ram module by module, cleaned the computer throughly for dust, checked the capacitors for leaks, tried different versions of Catalysts, checked for viruses, tested the hard drives for errors, changed the sata cables, and now I am out of ideas.

So I'm asking you guys here, what do you guys think what it may be. I'm thinking GPU,(and that's whay I put this topic here) but I'm probably wrong.

Anyway thanks to anyone who atleast tries to help me out.

Hi.

Well, a freeze by itself isn't a very telling problem, as there are numerous things which can cause it. The difference between the first and second freezes that you describe here is that in the first case video link is maintained, while it is lost in the second case. However, again, this isn't very telling as you're experiencing both.

The third scenario is a bit more useful, pointing straight to a .dll, but more information (perhaps a picture) about the bluescreen would help. If the computer restarts automatically and you don't have time to read the full blue screen, do the following:

1. Go to Start -> Control Panel -> System
   
2. Go to Advanced
   
3. Under the Startup and Recovery section, click Settings...
   
4. Under System Failure un-check "Automatically restart"
   

After a quick Google search, it isn't obvious that this particular .dll is involved in one error only (as it is often the case with .dlls).

To troubleshoot, (and this is a rule of thumb concerning problems in which you can suspect the GPU for any reason), I'd start by swapping the GPU for another one, which you know for a fact works, and is of course compatible with the system. If the problem still occurs after the swap, then we might have to dig further ^^

I already have the auto restart off. The error is something like this:

first it's mentioned about driver being stuck in infinite loop,
then ATI2dvag is mentioned,
then this;
STOP: 0x000000EA(0x8A6A53D0,0X8A7O95C8,0XBA4EBCBC,0x00000001)
The numbers as far I noticed are always different.

Not the damned infinite loop problem.

Had this on my 5890, odd thing is it was my leadtek tv card drivers that caused it, yet when i use MCE its fine.

Have a read here http://www.techspot.com/vb/topic15393.html

Well that seems to be a fix

One thing to note is that the fix is for AGP cards, so if your card is PCI-E, look for PCI Standard Host CPU Bridge instead of CPU to AGP.

Run memtest86+ and let us know the results.

Quote from shiny_red_cobra :

Run memtest86+ and let us know the results.

Tsk tsk, read first post

LOL my bad, I don't like reading! Try a new video card! Although with such an old computer it isn't even worth the investment.