Hi, I happened to read your post. Pretty frustrating. There's a way of course.
Boot into Single-User Mode. How? Turn on the Mac. When heard the chime, hold Command+S keys.
Mound the HD. Once Single-User Mode loads (black screen), type in:
/sbin/mount -uw /
Remove the 'Setup has been completed' file. How? Type in:
/rm /var/db/ .applesetupdone
Why such? This delete the file '.applesetupdone' in the /var/db/ director which checks on Startup to make sure the Mac has been setup. Since you have a problem somewhere around, we are resetting it creating a new Administrator Account.
Now, you reboot after the aforementioned command being typed in. How?
Simply type in: reboot and hit return.
Here what happens is your computer restarts and walks on with you as if it has been turned on for the first time so please walk through accordingly.
Once you continue Setup, make sure to select 'DO NOT TRANSFER MY DATA'. Why? Because you don't want to see the same grey screen loop again. Once you complete the simple setup as guided by your computer, come to the new user (Admin) account. And if you need, you can backup your files, music, media, act from your old user account because it has been saved in your USERS folder as "OLD USER". While setting up a new USER or ADMIN as we discussed, just make sure that you are not giving the same Old Name. Give it a new so that overwritten probability is secured.
Let me know if you're successful. My site is: acmt.newroadplaza.org Can leave me a written message from there too.