Yes, MZ, you can do this easily - XP will pick up all of the partitions - their letters may be changed however.
Once you have the OS running and updated - just Right Click your My Computer icon, Left Click Manage and open the Disk Management Snap-in to change your drive letters if you need to.
If your new XP disk is non-SP2, the entire package is available from MS - filename WindowsXP-KB835935-SP2-ENU.exe. It's mighty big - 266mb but will be faster than using Windows Update.
I would have thought that the Windows HAL will throw a wobbly .
Had this happen and it's not Fun !