BOAC,
Unless the hackers can also change how your system deals with .txt files then you are completely safe.
Try this simple experiment:
create a text file called "hello.txt" containing the two words: echo hello.
Save it to a convenient location. Double click on it - notepad (or your default text editor) will open it and display the text.
Open a command prompt, change to the location of the hello.txt file. type "hello" at the command prompt. Nothing happens (bad command or filename/not a recognised executable). If you type "hello.txt", nothing in happens in 98, but XP (and possibly 2000) will run notepad, as if you had double-clicked on the file. It shows the contents of the file, but does NOT execute anything.
Now rename the file to hello.bat (or copy, doesn't matter).
From the command prompt, in the same directory, type "hello" or "hello.bat". Now you should see the echo command work and "hello" appears on the screen. On this occasion, a command HAS been run, whereas as a text file it did not.
As you can see, your system will not open a program or command prompt to "execute" a plain text file. However, it will for a .bat, .exe, .com, .pif etc. as you already know.
HTH
SD