I don't know if it will work, but you can try deleting the drive from the device manager, reboot and let windows redetect it.
Also, this refers to Win2k. Don't know if it still applies to XP and it doesn't sound like you were using it as a boot disk previously.http://support.microsoft.com/kb/217226/en-us
Everything else I've seen implies that deleteing all partitions on a dynamic disk should allow you to convert back to basic so I'm not sure why it isn't working for you. Good luck!