If you want to perform a repair of Windows XP and can boot into Windows, do so and insert the CD, when the options menu appears select "upgrade" and follow the on-screen prompts.
If your machine is in a state whereby you cannot boot too Windows, insert the CD, power on your PC and boot from the Windows CD-ROM after it has finished loading files needed to runs the Windows setup program youll be given three options, first one being "Install Windows Now" youll also see an option to repair Windows (Do not select this)
Select that option and the setup program will try to locate an existing version of Windows installed on your PC if it does the following screen will give you the option to repair (Select this option) it will then take you through an upgrade of your existing installation without losing data, programs or profile information currently stored on the disk.
If setup doesnt detect an OS then im affraid youll have to seek further advice
From your second post though it doesnt appear to be a problem with Windows but with the applications loading at startup, i imagine theres either a lot of them or you have further issues to deal with.
Try booting to Windows and running "MSconfig" from the command prompt, on the first screen select "selective startup" then uncheck "load startup items" reboot and see what happens.