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You don't want to put an existing XP install on a new computer. Ditch that lousy little 30GB POS and get a new drive. You can't simply drop an existing XP OS onto a new system with a new motherboard anyway, without running into lots of potential issues.
I'd combine options 1 and 2, and build from scratch but use Win7. If you can't afford Win7, you can always pirate it and buy it later when you're able.
Intel is better for gaming on average, but there's lots of exceptions for that. My preference is always Intel when building a gaming rig, but you can do so with AMD if you're that determined to save a little money.
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