I have a pc ShuttleXPC it has a Windows XP home edition, I have been having problems with this pc because it frezees, it just stop working, etc. So a friend of mine told me to install a new Windows XP to it so I got the cd but when it comes to the partition part it shows 2 of them one unpatitioned one and the other says partition1 what should I do I don't want to messed this up more than what it is. I NEED HELP PLEASE... Thanks
PS is also saying tha it is not good to have two OS in one partition...and the other one it doesn't have enough space...

Uninstall Windows and Install the new one.

download the program killdisk, save it in a folder and extract all files. then burn to disk. leave the disk in your computer when it gets done burning. restart your computer. when your computer goes through the bios go to setup, that will bring up the bios menu. you are going to want to set up your computer so that it will boot from your dvd drive. save and exit, your computer will reboot and it will go into the killdisk program. the killdisk program will wipe out your hard drive. when it is done i would try to install xp again.

You can either make it just 1 partition or install XP onto the larger partition, then just format the other partition & use it as storage.
It definitely NOT good to install 2 Operating Systems on 1 partition.
{I also think that if the 2 OS's are the same, it may be impossible to do, but I am not positive about that}
Your freezing can be your system doesn't meet the requirements (http://support.microsoft.com/kb/314865). If RAM is the only issue, install more to reduce/eliminate this issue.