I was on an online browser game last night and I used OfferPal to get some free game credits. I must stress that the game itself was not the problem, just OfferPal. Everything was fine until lunchtime today. To start with, the malware dumped a bunch of links to adult websites into my startup directory. Removing those was easy. I turned off my machine and went off to lunch. When I turned my machine back on, it had created a new password protected admin user profile that it had used to deactivate my own profile's security before loading more adult material as the screensaver and it had totally messed up the desktop. In the end, I system restored back to a previous restore point and it solved the problem. Has anyone heard of malware that does this, i.e. creates a user account so that it can hack in?

That's what a back door does. It allows remote access. If the attacker were smart he never would have had the malware dump those websites into your startup & you never would have known the difference. Apparently, he wasn't doing it for profit. How do you know when a politician is lying? His mouth is moving.