Try this:
Put in the windows cd and boot from it.
See if you can delete/create/format through the setup.
Do not ofcourse delete C (unless you want to do a fresh installation of XP)

If you want to do a fresh installation:

  • Partition/format as you wish

  • Install XP

  • Install system drivers (check device manager and make sure there are no more exclamation marks or red crosses)

  • Install the drivers for your devices (printer, monitor, keyboard, scanner etc)

  • Install avast
    Do all the above before(!) going online.

  • Install the applications you are normally using. (text editor, music application or whatever it is you want to use)

  • Configure everything to your needs/wishes

  • Create a drive image (very handy if you need to reinstall again and much faster then a fresh installation)