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solved this on a similar thread "10g Overlapped I/O Operation" by changing the JAVA_HOME to the Oracle home jdk and removing Sun Java references from the Path system environment variable. I had the same error and that fixed it for me also on a Windows XP system.
to start the services for isqlplus in windows environment;
Goto $ORACLE_HOME/BIN
And run isqlplusctl.bat
D:\oracle\product\10.2.0\db_1\BIN>isqlplusctl.bat start
iSQL*Plus 10.2.0.1.0
Copyright (c) 2003, 2005, Oracle. All rights reserved.
Starting iSQL*Plus ...
iSQL*Plus started.
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