This is a well-known problem with XP
For some reason, MS decided to drop their '3-mode drivers' from XP,
producing that result.
Usually there's absolutely nothing wrong with the floppy - try copying it to
a non-xp PC, format the floppy on the same machine, then XP will read it.
There are several so-called fixes around, mainly force-loading 3rd. party
drivers, but I've yet to see it work.
In desperation, I now have 2 pieces of software which nowgives me the
ability to handle floppies in XP.
1. BadCopy Pro, which will recover most files on an 'unreadable' 'disk not
formatted' floppy.
2. Alkonost FloppyFormat, which will format the unreadable floppies on an XP
PC & allow it to recognise & copy to them.