You must remember that Windows Xp need HD space to copy their files. The files on the cd are compressed and need to be decompressed to be used. This is why you need C: drive.
When you boot from a floppy, the only file systems you can access are FAT16 or FAT32 (for a W98 ot WME boot disk). They cannot read an NTFS partition. So you drive must have a FAT something format. I suggest a FAT32. Use a WIN98 system boot floppy. you'll have all the tools to do the job.
The easiest way to do it is to created a FAT32 partition for your c drive. Let's say 10Gb. Then, format it. The run the install. You will have no problems. During the install, WinXP will ask if you wnat to convert to NTFS. GO ahead if you fell like it. In the business world, NTFS is the way to go for the security it possesses but at home, FAT32 would be fine. Windows NT 4.0 and 2K cannot read FAT32, so you had to format it to FAT16, and in the course of installing, it would ask you for a destination drive and he would then partition it and format it in a format he could understand. In 1996 (just about) when Windows NT4.0 came out, a 800MB drive was big stuff and below the 2GB limit of DOS.
Oh, one last thing. Make sure that floppy boots with smartdrv or something similar. Otherwise your install will take a good amount of time longer that it could.
