So, you've a rather old computer, right? That seems to be a valid conclusion if it only has 128MB RAM. Win XP won't work well on that computer. It may run, but the performance would be terrible. I wouldn't want to run Win XP on anything less than 256MB.
Your other question seems unbelievable. You're asking whether an entire Win XP CD can be copied to a 1.44MB floppy disk. Is that correct? Sorry, but this question warrants a
ROFLMAO sticker. My Win XP CD has 488MB of data on it. Does that answer your question?