How to reformat hard drive for XP Pro

I have Windows 98 in my system, and I want to take it out and shift to MS XP Pro. I don’t want to upgrade because I heard that it will just give me problem in the long run. Can somebody help me how to reformat my hard drive step-by-step? Is therea possibility that I will encounter a problem while in process of reformatting? If yes, what would that be and a possible solution? Somebody told me to do back up for Windows 98 for safety purposes. How will I do that? I have a quick restore CD and an emergency boot disk provided by Compaq.