How to access the Recovery Console:
The Recovery Console is a set of tools which run from a Command prompt. If your system is formatted as NTFS then these tools can help you manage the  partition. You can learn more about the Recovery Console through Help and Support  or

To run the Recovery Console  from CD boot with the Windows XP CD (or with the optional 6 floppy disk set) and select "R" at the Welcome Screen.

The screen will switch to black and you will be asked which installation to log on to. If you only have one installation you will press "1". Remember that numlock is off at this time.

Next you'll be prompted to enter your Admin password. By default it is created blank so just press Enter.

At the C:\Windows command prompt type "Help" for a list of commands you can use.

How to Repair the Boot Sector:
If XP won't start it may be due to a damaged boot sector or a missing or corrupt ntldr  or ntdetect.com files.

To replace damaged ntldr and ntdetect.com you can copy fresh files from the XP CD using  the COPY command. Boot with the XP CD and enter the Recovery Console (as above). At the Command Prompt type the following (where "X" is your CD-Rom drive letter) allowing the files  to overwrite the old  files
        COPY X:\i386\NTLDR C:
        COPY X:\i386\NTDETECT.COM C:

To repair a damaged Boot Sector at the command prompt type FIXBOOT and press Enter. Then answer "Y"

How To Format using the Recovery Console

Use the above command (where /Q performs a quick format of the drive, drive is the drive letter of the partition to format /FS:file-system specifies the type of file system to use [FAT, FAT32, or NTFS]) to format the specified drive to the specified file system. For example the following quick formats C partition as NTFS
        FORMAT C: /Q /FS:NTFS
 the following will do a full format of C as FAT32
        FORMAT C: /FS:FAT32
*** Note: If a file system is not specified, then the existing file system format is retained.
Type EXIT to quit the Recovery Console and restart your Computer

How Partition using the Recovery Console: (click for info on How To Access The Recovery Console)
At the command prompt type DISKPART and press Enter.

An interface is displayed which you can move through with the Arrow Keys. Press "C" to create a partition in unused space. Pressing "D" will delete the highlighted partition.

How To Exit the Recovery Console:
You can not use Ctrl+Alt+Del to quit the Recovery Console. Instead type "EXIT" at the command prompt and Windows will be started.

Boot to Windows.