You can create a bootable Windows XP pen drive using an automated tool like WinToFlash. I recommend using this application as it makes the whole process extremely easy rather than using BAT files and scripts. Upon installing the application, a wizard will greet you asking how you want to proceed, in Manual or Automatic mode. The best way is to choose Automatic as you will only need to select the source and destination for the setup files. Please notice that it is necessary to have a Windows XP Install Disc for this to work properly.
Start the application, insert the install CD, use the wizard to select the source (Install CD) and the target (the drive letter of the pen drive) and click next after accepting the ToS and wait for the process to finish and you will have a fully compatible Windows XP Installation source.
