My Acer laptop is not turning up after I changed something in MSCONFIG. My OS is windows XP. When I press power button the screen becomes dark and I am getting options like SAFE MODE, SAFE MODE IN Networking, SAFE MODE with comand prompt, Last known good configuration and start windows normally etc.

When I click enter for any of the options displayed, it seems like processing but nothing happens. The same page returns again. I can't move beyond these options. I tried to enter F8 then advanced option comes but again I can't do anything. When I click on Disable Automatic Restart a blue screen appears with error. Note: I can go to set up by hitting F2.

Please suggest me what to do. I have many important documents in C drive.

If no other option available then can I install XP through pen drive? And what is the process?

Why the MSCONFIG was messed with doesn't matter now. Most laptops come with a hidden partition that you can restore your laptop, unless you have made backups.
Check the Acer site for restoration. F10 or something like for the netbooks, not laptops.