Just confirming that the administrator login you are seeing probably has nothing to do with this. The greyed out screen is the same thing I see when I set a 2000 box to auto login. Basicially the system types the username and password in quickly enough that the only thing that gets seen is the greyed out fields while the system verifies the password.

On the keyboard front, no clue offhand what the problem might be. You could try booting off a Windows 2000 CD and see if the keyboard works there (as it does boot the 2K kernel for the install). If it does work, running through the recovery options might reverse the update that was applied and fix the problem, but with this also comes the risk of damaging it furthur.