Defragging your computer has noting to do with virus removal but simply compacts or defragments files that are scattered on your hard drive.
Run your virus scan- AVG is fine. As far as a virus in your vault don't worry about it it is isolated but if you really want you should have an option to delete it.
Run the defrag program.
Run Adaware to remove spyware - if you do not have adware get it from this link:
Ad-Aware SE 1.06r1 Freeware download page - tested and reviewed software downloads from SnapFiles
This is a great site for freeware downloads and is 100% safe.