That's right. XP Pro (the original flavor) is limited to 127GB (sorry but as folk count bytes and GB differently, different numbers show up in the reports.)

It's pretty easy to fix but in this case you can't easily fix it. That SATA drive is something XP knows nothing about so the exits are obscured but let's note them.

1. Enable AHCI or disable it and try again.
2. Enable IDE emulation in the BIOS (if you need BIOS help, supply the manual about that and I'll find the page it's on)
3. Get a newer XP SP2 or XP SP3 CD and use the SATA F6 DRIVER FLOPPY INSTALL METHOD (see google)

Sorry to see you hit that pothole.
Bob