Hi Wendy,
That is not the called the Status Bar. The status bar is what shows bottom
when IE or WE is opened immediately above the taskbar.
Right of the Start button is the Quick Launch bar, then the task bar then
the notification area.

)
Suggestions:
This can happen by opening Accessibility Options, etc. If the icons on the
Quick Launch bar are showing as being larger, it will result in the taskbar
being twice its height and also include the date or similar under the clock.
If this is the case, right click the Desktop/Properties/Appearance/
Advanced. Under the Item drop box choose Caption Buttons and change the
number by one, ok your way out, then rest to 25.
And/or reset your default to the XP Theme.
Other options to consider if the above doesn't help, nor moving the glider
over toward the Start Button to list only three icons in the Quick Launch
bar:
Lock Size, Settings and Position of the Taskbar (Line 128)
http://www.kellys-korner-xp.com/xp_tweaks.htm
Restore the Taskbar to Default Functionality (Line 164)
http://www.kellys-korner-xp.com/xp_tweaks.htm
/top10faqs.htm