By law you are supposed to buy a product key for each machine running. However ,I personally have called MS on vista and xp when needing a new product key. They verified that I had an actual cd, asked why i needed a new key and gave me one. Currently, I have one cd for vista and one cd for xp. But I have three vista product keys all work. The new key I was given for xp has been used on 5 machines. currently it is on 3. All are registered with MS. I dont condone pirating software but it can be done. MS WILL give you one (around 5)for free.
YES one cd will install on both machines. but it must be a real MS cd not a restore cd.
P.S. I bought the machines with xp pro. I just did a clean format because of all the junk that comes on a new computer. I OWN 7 or 8 product keys. I chose to use one because it is easier. If MS needs it I can prove every copy I have or should have. All machines are registered and have automatic updates on.