[Oh - I forgot to say welcome to BC Forums!]
You definitely have internal sound hardware. With the circuit board (about the size of a candy bar), it may not necessarilly be a sound card. What connection types are located at the back of that circuit board? This may identify what service it provides.
What you have been told is correct. Anytime you install a new Operating System (in this case Windows XP (I assume it is XP Home? - Is it Service Pack 1 or 2)), you also need to install the motherboard drivers as these are removed from the Hard Disk during the installation. Additionally, a legal copy of Windows XP would normally automatically update drivers, however unaithorised copies will not. That does not mean that the drivers are not available however.
This is what I need from you:
1. What is the circuit board connected to your motherboard? (Let me know what connection(s) is/are on the back)
2. What is the exact brand and model of your motherboard? (This can be found (usually) written on the board near the CPU. Additionally, you can download EVEREST Home Edition (
http://www.lavalys.com/products/download.php?pid=1&lang=en ) to identify your MB).
From this we can:
1. Make sure there is not a conflict of devices (eg. both internal and external sound hardware)
2. Identify a suitable location for motherboard drivers (which will include sound hadware drivers (e.g. AC'97 Audio etc)).
Here from you again!

Justin