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It has it's uses, but MAKE SURE that you really understand what it does before using it - which of course is what you're doing by posting here.
I tend to do things unconventionally on my computer (meaning, I don't use the "My Documents" folder for files, etc) and system restore tends to count on the user doing things the conventional way. I don't remember all the particulars, but I do know you can lose valuable stuff if you do a SR and you have certain files stored in places the Win does not expect.
So yes, backup all important files first before doing anything (photos, docs, music). Then see if you can clean up the mess, and if not, just do a complete re-do (reformat, reinstall, etc)
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