Also it is not hard to plug the drive into another computer with more IDE if you have no more 2 channel cables (which how can you not since you get a gazillion every mobo purchase, only thing I have more of is floppy cables...) and use the command lines to start the install to the drive.
You can get an XP install to the point where all files are copied to the drive. This would be the point in the installation where it tells you to remove the CD and it will reboot in 15secs before the pretty GUI appears. All that can be done on a seperate computer. Then unplug and plug it into the host computer and it will resume.
I was afraid to hook up the optical drive and the hdd on the same ide. turns out it wasn't a problem, just had to mess with the jumpers.
Got it all running on a 7200 RPM drive w/ 8mb buffer. I'm getting 30 second cold boots and 15 second resume from hibernation times. Almost acceptable :)
Well there you go. Now you know it is the HD, so you can get a good one. I never suggest 5400rpm (or even lower...) drives except to save power which really isnt an issue here.