Check your CD for smudges or scratches. If so, clean it. Reboot your PC and lookout for "run from CD". As soon as you see this hit 'any key' to boot from CD. Let me know what happens.
Thanks for the help. The issue turned out to be a problem between the keyboard and the chair. I mistakenly grabbed the Office 2003 disk rather than the Windows XP disk. No wonder it wouldn't boot from the CD drive.
I appreciate your recommendation no less.
Thanks everyone for the help. I been using W7 with your help since my post.