Disconnect the second hd, boot from recovery disk and clean install. It will put your PC back to factory condition, which may mean the HD is configured with two partitions. If you want to finish up with a single partition you would then need to use a third
party partition manager eg Partition Magic
Any preinstalled Acer software you would need to uninstall. Otherwise you would need to buy a winxp Home retail version with key to do as you wish - I'm not entirely sure whether generic winxp home oem version would work with your key, if you could borrow
one