Hi Reanne, XP will format it for you providing you set the bios to boot from the cd rom as first boot device.
I think you may have installed over the top of your old installation from inside windows.
Boot from the cd, you will need to press a key when it says press any key to boot from cd.
just folow the instructions on screen until you get to the option to install to C partition or other or delete a partition.
Highlight the C partition, if you have more than one then select delete that partition, the next screen will warn you that there is an OS on it and asks you to press a key to delete it, (I think its L but it tells you which does which), then you need to create a partition and then install XP to that partition at which point it will ask you how you want to format it.
If you are just using XP as a single OS then select NTFS (quick), if you are dual booting with 98 or ME then it would be advisable to select FAT 32.
Thats all there is to it and you will have a nice new clean installation of XP.
Dont forget to reset your bios to boot from either your hard drive or floppy again once XP is installed