With regards to your question on the included backup program, I use NTBackup on my mother's server (Windows Server 2003). It backs up nightly to a removable hard drive and she swaps it out once a week, taking one home for the week and leaving the other in the server to get the backup.
For you, you'll want to make an Automated System Recovery backup (there's a wizard) that will backup the OS partition and create an ASR floppy. This floppy tells Windows Setup how to perform the restore. Just make sure you have what I call a 'normal' Windows CD which will understand the ASR floppy. You should also make sure to back up any other drive partitions you have the ASR wizard only covers the system partition (usually C drive).
Then to do a restore, you boot up the Windows XP installation CD, put the floppy in, and tell it to do a recovery using ASR. The CD will install Windows and then the ASR part will take your backup and put that data on. Once booted back in, you can recover any additional partitions you have.
Some computer manufacturers include a CD that images the machine back to a factory image, or they don't even include CDs and instead put the recovery info on the hard disk, in which case, you might be able to use that to perform the initial reinstall and then use NTBackup to recover things back. While my mother's server has what I call a 'normal' CD, this is the process I use to recover it (I've done it once due to making a bad setting change - shame on me). I first reinstall using the CD and then go into NTBackup and restore the backup - reboot afterwards and it's all back. While it works for me, your mileage may vary... I suggest ASR over this if possible.
As always, though, you should TEST your backup out and make sure it's working. For whole system backups, the easy way for that is to throw a different hard drive into the computer and restore to it - if it boots up, you're all set. If you're just backing up select data files, then restore them to a different place to see that they come out ok. An initial test is wise, and then check it now and again just to make sure it's still working like you expect.
Some links I picked at random:
What’s ASR in Windows XP/2003?http://www.petri.co.il/whats_asr_in_windows_xp_2003.htmAutomated System Recovery (ASR) Overviewhttp://www.tech-faq.com/understanding-asr.shtmlFor me at home, I use a whole-system backup method that runs nightly automatically across all my machines. It's Windows Home Server if you'd like to check it out. I run it on an old laptop which is sitting in the closet.
//A
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