I would go with the idea of aquiring the legit version of Windows XP. However, i have been using WinXP Pirate copy for almost 2 years now and i have had no problems. However one time installing it, it would restart at the welcome screen god knows why i think it was my Hard Drive failing. Anyway to get to the point, if you are having problems when in installing Legit XP it is mosrt likley a Hardware issue and you should go ot the person who built it and check it out, it may be something is confplicting with each other (not compatible).
Let me know how you get on.
Regards,
Dragoonis