you cann't install wimdows 98 or me because windows xp is most likely installed as ntfs. forget useing xp to do the install. look for a program called deplart it was created by microsoft it will delete any partion dos (95-98-ME,3.1) or ntfs (NT 4.0-2000-XP, NT3.51).the hard drive will look like a unpartioned hard drive.then set-up accordingly. you can also use Dban to clean the drive it takes a while bepending on the size of the drive but will be wiped clean past mil specs if you want .
http://support.microsoft.com/kb/q103049/