boot gparted...a desktop should appear with various options i think a window should pop up showing your dirves right click on the drive you want to format and select NTFS from the list, making sure its in NTFS and nothing else click on run these operations
boot up your xp disk, install without formatting as you have just done that and it should be ok..
EDIT: you must burn the gparted image to a CD-R with an ISO burner.. you can download free ones