The Dell restoration cd will recreate the recovery partition if necessary so deleting both is safe.
Before proceeding make sure that you have all necessary drivers ready from here
Put them on a jump drive or burn them to DVD.
You want to download the chipset, audio, video, network and communications drivers only.
Be sure to install the chipset first and then the order of the rest really doesnt matter.
I always do chipset, audio, video, network then modem.
After that install antivirus software, malware programs and the rest of your apps.
If you have a USB printer, unplug it from either the back of the computer or printer (whichever is easier) befire reinstalling XP. After the drivers are installed, run the cd tha came with the printer & dont plug it in until promted to do so.