Some people partition their harddrives for servers or when they need to run more then 1 operating system
If you wanted to you could make a partition for xp and another partition for windows 98 or linux and switch off between them.
i was wondering what does the disk partition do? I have seen where people set up a small place and install Windows in there. when i installed WinXP on this PC i just installed it on the whole disk. Does that affect my pc in anyway? Also if i want to add a new harddrive do i need to do anything like disk partition?