bit late...

+1 about skip Vista.

If you want to transfer XP onto a new computer with new motherboard, new hard drive... you will need to call microsoft and transfer the license onto a new computer. You can do this only so many times 3 or 4 times. Other issues are not pertinent to you so not worth talking here. Oh and you taking your old hard drive with XP and installing into a new machine will not allow you to run XP. There is a minor thing called registration (XP keeps track of your hardware and its setup). If you change enough of it, XP no like and will tell you so.

Increasing the memory capacity of your old computer may give you what you want. 7 year old computer may be using a hard drive interface called ATA-100/133 this is lot slower than SATA. Slower transfer from your hard drive will slow your machine down.

Memory in your older machine may be using an older memory sticks. Again, its transfer speed is much lower than the newer ones like DIMM2s.

And finally, the processor is not duo-core.

XP will support the newer hardware but it may not take full advantage the hardware on the down side. The upside is its still better than VISTA. XP will run much faster on a newer machine. And be sure to have at least 2Gbyte of RAM, and preferably 360G hard drive or bigger. Check prices on newegg.com for cheap complete computers.

LINUX is something I would not recommend unless you have a special need or tech savvy. There are things like VMware which allows you to emulate XP machine and run just about all XP based software. There is also WINE which runs on LINUX to do the same thing. And several more. VMWARE is probably the easiest. and its also free. I have VMWARE on my office computer and it runs just as fast as native XP machine.

I have a special need so I run MANDRIVA LINUX. Another nice one is UBUNTU, and several other releases. With Linux you do have to pay attention to the hardware you want to addon/purchase since it may not be supported. So for you, I would stay away from LINUX.

Stay with XP. and stay away from blunt/bleeding edge of technology. Wait for windows 7 to mature a bit.

I run XP only when I have to. I don't bother with VISTA. and MAC is good. I know several people who swear by them. All of them are way beyond geeks and know how to recompile a OS release from source code. They are GODS! And another one who has a hackintosh. (don't ask what that is). And she too being a GOD, loves her hackintosh. I'm not even a demi-god so I stay with Linux. oh I think you can google hackintosh. TMI

smilingcat