Your problem starts with misunderstanding how drives are identified and used. You CAN do what you originally wanted to do. From what you said, you wanted to have the computer continue to use the older IDE HDD as the C: drive to boot from, and then use the new SATA drive simply as a data storage device, not the boot drive. Yes, I'll outline how that is done. In fact, it is what is happening now, but it needs a few adjustments.
Many of us are used to the old way things were: The default way was that the machine's Boot Drive is the Master on the Primary IDE Channel, and that is called C:. So we think that all other drives have to be Slaves. NOT SO.
An IDE channel port and its cable support up to two drives. Because each has to be uniquely identified, the system is that one is Master, one is Slave. Any IDE channel in use MUST have a Master. IF there is a second drive, it MUST be the Slave. For this each IDE drive has a set of pins and jumpers to establish this identification. At minimum there are two options: Master or Slave. Sometimes the Master is replaced by two sub-options: Master with No Slave, and Master with Slave Present. More recent drives also added a fourth option, Cable Select or CS. With one drive on a channel you MUST set it to Master (or Master with No Slave). With two drives, the second MUST be set to Slave. If the option is there, the first drive may have to be changed to Master with Slave Present. How the cable is plugged in is somewhat important here - the END connector should go to the Master, and the middle connector to the Slave.
The alternative to setting the specific designations is to use the Cable Select (CS) option on BOTH drives. Then the Master will be whichever drive is plugged into the END connector, and the Slave will be the middle connector. With only one drive using the CS system, it MUST be plugged into the end connector so it can be the Master.
All the above applies to ONE IDE channel. If you use a second IDE channel, too, it must be set the same way. NOTE that the "Master" and "Slave" designation is ONLY for keeping track of the two devices connected to ONE IDE channel. It is completely separate from which drive unit acts as the boot drive called C:. There is no such thing as a "Master" drive for the entire computer.
If you connect both a hard drive and an optical drive to one IDE channel, it is highly recommended that the hard drive should be the Master. There are a few optical drives that could not fill the Master role if the Slave on the same IDE channel was a hard drive.
At one time it was normal (and hence this became the default option) that the Boot Drive in the system was always the Master unit on the Primary IDE Channel. More recently BIOS Setup screens allow you to make a choice of which connected device will be used to boot from. So now your Boot Drive is not necessarily the Primary Master.
Enter SATA systems which include one very important difference. All SATA ports and cables support only ONE device per port. So there is absolutely NO reason for identifying drive units uniquely because the controller already knows the port number for each drive, and there can only be one drive on each port. There is NO Master or Slave for any SATA unit.
So, what happens with both IDE and SATA units in your machine? On the IDE channels which allow two devices per channel, you still have to set Master and Slave on each IDE unit, and for each channel if both are in use. On the SATA ports you don't set anything like that.
Completely separate from that identification item is the question of which drive does the machine boot from and call C:? It is the one you set in the BIOS Setup screen for Boot Priority or Sequence. As far as your system is concerned, every other drive device in your machine will be a plain data device. It is entirely possible for you to Partition and Format two or more drives in your system as Bootable drives and install operating systems on them all. But the machine still will only boot from the one drive you specify in the BIOS.
The place you set up these choices is rightly called Boot Priority or Boot Sequence, because you can set several options to be used in sequence. Many BIOS's have up to four possibilities. For example, I have mine set up with three. The first choice is my floppy drive. If I put a bootable floppy disk in there and start up, it will boot from the floppy and never look at other places for boot info. Very handy when things go wrong and I need to boot and run from a diagnostic tool kit on floppy. My second choice is the first optical drive. If I don't put a bootable disk in the floppy drive, it will go next to the DVD reader and try to find a bootable disk in there. If there is one (say, a Windows Install Disk, or a Knoppix disk) it will boot from that. My third option is the hard drive connected to the SATA_0 port. For most cases I will NOT put bootable media in either the floppy or DVD drives, and this is where the system will end up finding a bootable disk to start up from. In my BIOS I specified the fourth option in the sequence as NONE, since there is no other place I want it to look.
What OP should have done was not worry about setting the new SATA drive as a "Slave", because there is no Slave in a SATA system. The confusion was that he / she thought any drive you can't boot from must be called a "Slave", which is not true. Anyway, after getting that new hard drive set up, OP boots and finds that the machine is still booting from the old IDE drive! Well yes, it is, because the Boot Sequence setting in the BIOS never was changed - it was left at its original default setting: boot from the Primary IDE Channel Master unit, and there's no other option. The intriguing thing is that, even though OP made the mistake of setting the old IDE drive to a Slave (so there is no required Master on that channel), the system fixed that mistake and is using that drive as if it were a Master so it still finds the drive and boots from it.
First step: change the old IDE drive's jumpers back to Master so the IDE channel has one. This drive will continue to function as the C: drive that boots the machine into Windows.
Next is to resolve how the SATA drive is to be used. I suggest the whole drive be blanked out and re-arranged, so the second step will have to be backing up any data stored on any of the Partitions of the SATA drive.
Now, how do you want to use the SATA drive? Although you installed Win XP on it, that was not your intention originally. If you actually want to make the SATA drive your boot device and later re-assign your old IDE drive for another use, that can be done. But for now I will assume you still do not want that, and the SATA drive will be for data only. You seem to want to make it two Partitions, so let's proceed that way.
Third step (after data backup) is to Delete all Partitions on the SATA drive. After that we'll create new ones. These steps can be done nicely with free software tools you download from the WD website for use on one of their units (you said it is a WD Green series drive). Go to the the WD Support site and download and install Acronis True Image WD Edition. Also download and read the User Manual for this. Is is very useful software with a lot of tools for you. The instructions for this specific case - leaving the existing boot disk with Windows installed in the system, and just adding a data storage disk - begin in page 48 of the manual. Run Acronis True Image and follow the manual's instructions. Be VERY CAREFUL that you identify the old drive on the IDE port as the SOURCE Drive, and the new SATA unit as the DESTINATION drive, because the data on the DESTINATION unit will all be destroyed. Delete all old partitions on the SATA DESTINATION unit, then create and format the Partition(s) you want on your SATA drive. You will end up rebooting when finished and it will all work.
If you change your mind, Acronis will also help you make data backups if needed. It does a great job, also, of cloning your existing system to the new drive so that, when you're done, the new drive takes over as your boot drive leaving the old one not necessary. If you choose this route, remember to go into the BIOS Setup when you're done and change the Boot Sequence to make the new disk on the SATA port your boot device.
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