Do not rely on the method in the KB article that was linked to. It is a last
ditch effort only type of thing. It may get XP running but you will have
problems with the installation. It should only be used as a back door to get
XP running long enough to backup your data. It is not a substitute for a
backup. I use Acronis True Image for backups but there are many other good
solutions. Here's some tips for upgrading.
1) Backup your PC.
2) Back it up again.
3) Test your backups.
If you skip the above steps please don't whine that the upgrade trashed all
your files. Any process that involves this many changes to the file system
is fraught with danger. If you don't have full backup of your pc before
starting the upgrade you are an idiot and shouldn't really have a pc to
start with

This may sound harsh but it is reality.
4) Run the latest version of the Upgrade Advisor and note anything it flags.
5) Uninstall (not disable) all antivirus, antispyware, firewall, disk
utility, and system utility programs even if the upgrade advisor doesn't
mention them. You will need to install Vista compatible versions after the
upgrade is finished.
6) Uninstall (not disable) all programs that the upgrade advisor flags as
possible problems. You will need to install Vista compatible versions after
the upgrade is finished.
7) If possible remove all hardware that the upgrade advisor flags as
incompatible.
8) Make sure you have Vista compatible drivers and software for all your
hardware devices burned to CD. Don't just look for drivers that the upgrade
advisor mentioned. If possible have drivers ready for everything.
9) Physically unplug any external devices like portable hard drives,
printers, card readers, flash drives, cameras, etc..
10) Run a chkdsk on all the partitions on all hard drives still connected.
11) Defrag the system partition.
12) Start the Vista upgrade process.