Basically you need to make sure all your personal data is backed up first. Anything that you cannot afford to loose, or that is not on some other computer.
Once it is done it is fairly easy. You boot to your windows XP machine and follow the instructions. When you get to the section about what partition you want to install Windows on, you want to delete the windows partition and then let windows recreate it (this is the best way to get rid of all the malware that can really dig in), then let windows go thru the install process. It will ask you a few questions, you answer them and let the installer do everything else.
I know that is very short, but it is really that easy. But there is a much longer and very explanatory version available. It has a lot of screenshots so it will show you exactly what you will see. It is here
. It is in 4 sections of 10 pages. The first section is all about prep. If you want to skip that the second section starts here
Once you get Windows XP reinstalled then you want to install all your drivers. These should be on a separate disc that should have come with your computer when you purchased it. If you don't have them, you will need to get them prior to installing windows. Next download SP3
(or use the CD your neighbor made for you) and update windows to SP3. Once that has installed, do all your windows updates. There is close to 200 of them that have to be done. Once you have done the first batch, reboot the computer twice and then run windows update again. Keep repeating this pattern until you no longer get any updates twice in a row. I know this sounds like overkill, but there are many updates that seem to do better with two reboots to let them "settle" in. And there are many updates that require other updates to be done first, so you will not even seem them until all its requirements have been met. Updating after installing SP3 is what takes so long, it can take up to 6 hrs depending on your computer and the speed of your internet connection.
After all your updates are installed, then install your antivirus and other security software. Once those are fully updated, then you can install the rest of your software. Once you have that fully installed, then you need to scan the personal data that you backed up. You want to make sure its clean before restoring it to your new install of windows. Once you are sure its clean, then you can restore it and you are done.
If you would like, I will leave this thread open until you tell me you are done. That way if you have questions you can ask. Also you should look over everything before you start to make sure you understand everything, and have all the bits and pieces you need.