Yeah, this is annoying. I had similar issues. To resolve it, you need to one by one, go through all the programs you have set to start up with windows, and start removing them. An easy way to do this is to boot windows, then go to your start -> run.. and in the popup dialog type "msconfig". A window will show up called the "System Config" window. Go to the [Startup] tab, and you will see a list of everything that is scheduled to boot up with windows. Go through the list and uncheck one by one, all the applications you deem as uncessary to the arcade cab. Hit "OK" button, and restart. Repeat the process until everything appears to be working in Mala. Then start the process in reverse, enabling applications until you figure out which one breaks it again. For me, I remember the ATI control panel being an issue.
Good luck! The Mala focus issue is a tough one.
-csa