Hew Jaz,
Try what SD is suggesting again.
I can expand a bit on what SD posted:
Disconnect old (ME) drive
Connect new drive
Configure it as Master
Check your BIOS settings to allow boot from CDROM
Insert XP CD in drive
Reboot computer
Install Windows XP**
Connect old (ME) drive as slave
Copy files*
*Note - most programs cannot be 'copied' from drive to drive. They must be installed. Data files, emails, address book and favourites can be copied.
**As a precaution against bringing virus/worm/etc aboard the new system,before connecting ME drive, I would suggest updating XP via Windows Update and installing and updating an Anti-Virus program. AVG (free) works very well - was recommended to me here.
Good Luck!