If you're formatting and re-installing, might be worth creating 2 partitions on your new install. One for windows, the other for games/personal files. So you can flatten your windows install in the future without having to set up all your games etc again.
I like that idea. Will 60gb be enough though? As a lot of games nowadays seem to be like 8gb for install. Maybe i should use the 60gb for music and partion 150gb for games from my 500gb.I'd personally partition the 80GB. 20GB for XP and the rest as a games partition. Saves a lot of a trouble in the long run.
wrong choice. install windows fresh on the 500gb drive ( partition it first) as it'll be far faster than what you have now. use the 80gb for music instead, but keep your eye on it as its an old drive.