First, you are right about the OEM version of XP Home, it is permanently 'tied' to the system it was supplied with and cannot be used on a different PC. Basically, when it's host PC dies, the OEM version of Windows XP dies with it.
Now, as for installing an upgrade version of XP Pro. The best method of installing to ensure the least number of problems and the highest degree of stability is to install it on a freshly formatted, empty partition. "But it's an upgrade" I hear you saying, "How can I do that?"
Well, just because it's an upgrade doesn't mean you have to install the previous or older version. Just boot from the XP upgrade CD and at some point setup will ask you to prove where your copy of Windows 95 or 98 is. Just swap the XP CD for the 95 or 98 one (unless you have two optical drives), and navigate with the mouse to the Win95 or Win98 folder on the old CD. Click OK, XP setup will be satisfied and will ask you to put the XP CD back in. So no problems with the OS recognising the large-capacity disk, provided the BIOS is fairly recent (4 years or less), and there's no need to install an OS just to perform an upgrade.
Edited by pip22, 13 July 2005 - 02:45 PM.