The driver CD won't work with your operating system, XP. The driver CD is too old and is intended for use with 98 or millennium edition, you need later drivers. Put the CD away.
I had a quick look online and you may be in luck. I have linked a page below with drivers for XP, but it specifies a model number CS330 (for the webcam).http://downloadcenter.intel.com/Detail_Desc.aspx?agr=Y&ProdId=460&DwnldID=3614&lang=eng
Also another note is that the drivers don't contain contain any Intel Create & Share® Software. You may be able to find the software for XP by searching the site.
Hope this helps.