I've tried to resize in Ubuntu as well, and I couldn't.
I've also tried Partition Manager 7.0 Professional, and I still cannot resize (perhaps you're having the same problem as me, since I've been told that the Ubuntu partition tool should work perfectly). Also, the one time that I've used Partition Magic it completely killed my partition, and I had to reinstall XP -- everything.
I've also defragmented my partition at least 3 times, and still I'm not able to resize.
..Blah, its horrible. I've googled my problem too many times, and I've posted on too many forums for help. I still have no answer.