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To answer the last question first...all they have to do is logon to the Administrator account, which most people don't bother to password. It's accessed in XP Home by booting into Safe Mode; in XP Pro by either booting into Safe Mode or by pressing Ctrl/Alt/Del twice at the welcome screen.
That account has full access to everything on the system.
Generally, data retrieval programs are hit-or-miss. It's not unusual for the data they recover to be incomplete. The more the computer was used (data written to drive) between the deletion and the recovery attempt, the less the chances the data will be complete. Even the high-dollar data retrieval companies claim, at best, 95% recovery.
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