You should be able to upgrade to sp2. Just dl it from the microsoft site. I would build your new system with the sata hdd and put the old hdd in the external and reformat it then. I thought there wasn't a limit on os CD's, just that it can only be installed on one computer? You will have to get another key for it though by calling up microsoft.
Im waiting too, but i won't be able to get a new gpu until this summer. So i will go with w/e the best dx10 card there is out then.
CPU: e6600 @ 3.2ghz
RAM: 2GB G.Skill HZ PC6400
Mobo: ASUS P5B Deluxe
GPU: Sapphire HD4870
Soundcard: Creative Labs X-Fi XtremeGamer Fatal1ty
HDDs: 250GB WD + 750GB WD + 2x1TB WD
Monitor: Samsung 226BW
PSU: OCZ GameXStream 600W
Case: Cooler Master Stacker
OS: XP Professional SP3
Mouse/keyboard: Logitech MX518/Saitek Eclipse II
Speakers: Logitech Z-2300