In reply to my own question, I fixed it before I received help from this forum.
#1. Nothing in XP Pro will format to FAT 32 which is required by all large capacity flash drives.
#2. Even though this is a "fake Kingston" it is more of a "knock off" which means it was manufactured by the same Chinese company that manufactures the real ones. The amazing thing to me is that the Chinese manufacturer can sell it for $45.00 and make a profit. Kingston sells it for $400.00.
The Cure: Downloaded KILLDISK freeware. Ran single passes until flash drive was completely wiped.
Downloaded HP Flash Drive Format Tool freeware. Program re-formatted flash drive back to FAT 32.
Yes, this is a true 128G and works great!
Thanks to everyone for your help. Hope this information will help someone else in the future.