INCREASE THE HDD SPACE IN W/ XP

Yes there is a way to expand your primary partition. There is not a way to do it with Windows, but there is some third party software that does this very well. The one that I love to use is Partition Magic, I believe the latest release ia version 8. But you can expand your primary partition to make it bigger.
I have used this app many times with no problem.

Good luck!

I use partition commander.

I used partition magic before without problem but I have clients who had trouble using this. If you are not sure about these s/w, reload windows is the best solution.
Reformat drive c will not get rid off the two partitions, you must use fdisk to remove both partitions then create a single primary partition. In fact with Win XP you do not have to create a partition at all, Win XP will partition and format the drive automatically.
Make sure you save you data first before using this solution.

There is a solution, but it probably will not work without specialty hardware. RAID 0 is the solution, and it works by striping the information across many different disks. However:

if you are using windows, you will need a hardware controller,as you cannot stripe (through software on NT/2k/XP) the system partition. (Without using 3rd party utilities)

Linux needs to have /boot to be outside of the stripe, since it cannot understand the partition without the kernel booting.

In XP, you can compress all folders (if using NTFS) by right clicking on the drive, properties, ticking the compress files or folders, tell it to propogate to the subfolders.