I would try to run chkdsk /r on the C: partition, if I had a Genuine XP CD.
If not, I would download the XP Recovery Console, http://www.webtree.ca/windowsxp/repair_xp.htm
I would then burn the .iso file to CD, using one of the programs listed at How to successfully burn or write an ISO-image to cd or dvd - http://iso.snoekonline.com/iso.htm
. Insert the CD in the optical drive.
Then I would change the BIOS boot options...save changes by hitting F10...and let it reboot.
Once the Recovery Console came up, I would follow How to use CHKDSK in the XP Recovery Console - http://pirules3.14.googlepages.com/recovery_console_chkdsk