Showing my ignorance...but what is the WD installation CD?
To install a new hard drive...all that should be done is to connect it to the appropriate cable...see that it's recognized in the BIOS...change the boot order so that the system boots from the CD...insert the XP CD and format/partition/install from that.
At what stage of this process do things go wrong?
FWIW: There is no neutral setting for drive jumpers
. The C/S setting is one where the system senses which is Master and which is Slave by position on the IDE cable. Both devices on the cable must employ the C/S setting if two devices are on that cable.
I would try the install with each device (hard drive and burner) on separate cables. I would use the C/S setting, but using the Master setting on each drive (with each connected to the end connector) achieves the same thing.
If there are any error messages, please post those.