Lets try this.

When your computer boots up. Push F2 or whatever button it is to enter
setup. Because whats going on most likely is your PC is set to boot from the
HDD before the CD. So when you get in the BIOS find the boot order and set
the CD to boot before the HDD. Then it will give you the prompt to boot from
CD. Also keep in mind that when you reformat your PC. You will lose all
data. So be sure to back up your documents and other things before you do
the format.

John

The Windows XP CD is bootable and contains all the tools necessary
to partition and format your drive.  Follow this procedure and allow
Windows XP to partition and format your drive:

NOTE:  It would be best to physically disconnect all your peripheral hardware
             devices, except the monitor, mouse and keyboard, before installing XP.

NOTE:  If you have an internal Zip Drive installed, physically disconnect the
             EIDE and power cable to it before proceeding, otherwise your main
             hard drive may not be assigned the customary C: drive letter.
             After installing Windows XP, you may then reconnect it.

1.    Open your BIOS and set your "CD Drive as the first bootable device".

      ===> Accessing Motherboard BIOS
      ===> http://www.michaelstevenstech.com/bios_manufacturer.htm

2.    Insert your Windows XP CD in the CD Drive and reboot your computer.
3.    You'll see a message to boot to the CD....follow the instructions.
4.    The setup menu will appear and you should elect to delete all the existing
      Windows partitions, then create a new partition, then format the primary
      partition (preferably NTFS) and proceed to install Windows XP.

5.    Clean Install Windows XP
       http://michaelstevenstech.com/cleanxpinstall.html

       [Courtesy of  Michael Stevens, MS-MVP]

6.    ==> Immediately after installing Windows XP, make sure XP's Firewall is enabled:
      ==>  http://www.microsoft.com/athome/security/protect/windowsxpsp2/Default.mspx

7.    After Windows XP is installed, visit the Windows Update website
       and download the available "Critical Updates".

8.    After installing the critical updates, be sure and visit the support website
      of the manufacturer of the computer to download and install any
      available Windows XP compatible drivers, such as video adapter
      and audio drivers.

9.    If you happen to run into any installation difficulties, use the following resources:

      How to Troubleshoot Windows XP Problems During Installation
      http://support.microsoft.com/default.aspx?scid=kb;EN-US;310064

      Troubleshooting Windows XP Setup
      http://www.kellys-korner-xp.com/xp_setup.htm

      [Courtesy of MS-MVP Kelly Theriot]