walter83 did you use my directions from the TF tutorial?:
just curious, your script looks very similiar. I beleive your problem lies here:
that is telling ghost to use the image file called winxp.gho from inside a folder called ghost. lets assume your 1:2 is your FAT32 drive. did you name your ghost image winxp.gho and did you stick that inside a folder called "ghost"?
can not open the image file means it cannot locate your winxp.gho file in the location you specified in your script.