Bootcamp FAT32 vs. NTFS

When installing Windows XP on a Mac, BootCamp creates a FAT32 partition for Windows, with ID “BOOTCAMP”.
When you remove that partition during the Windows installation process, and replace it with an NTFS one, Windows will happily install, but fail upon reboot with:

Windows could not start because the following file is missing or corrupt:
\system32\hal.dll
Please re-install a copy of the above file

The trick to get this working, is to leave the partition schema intact, and only reformat the filesystem.
What you should do, is select the FAT32 BOOTCAMP partition to install Windows on, then pick this option:

Format the partition using the NTFS file system (Quick)

Then press F to format the drive

This should give you a working Windows XP installation.