Xp pro will work fine, however bare in mind that you will not be able to view DX10 or DX11 effects with it as XP is unsupported.
Doesn't matter either if you upgrade the Graphics card, only cure is to buy Windows Vista or Windows 7.
Yes, it will play almost all games just fine. The only exception would be games that has dropped DirectX 9 support such as Just Cause 2 and the upcoming Battlefield 3. Those games can only be played on Win Vista or Win 7 since they require DX10 or DX11 to play.
Win XP only supports up to DX9 even if you install a DX11 video card.
you forgot halo 2 that shipped without dx9 support. there is another title but it didnt sell at all...
im not sure bf3 will be dx10 only as they are porting it to console so they will have a dx9 version for them.
Yeah, I did mention Halo 2 in another post. I think it was in either the Win 7 or Win XP sub-forum.
Halo 2 was the first and only DX9 game that is not playable on a DX9 OS (Win XP). That other DX11 only title your thinking about was some crappy space genre game that quickly faded from the gaming arena.