Hi,
One of my technicians had this problem with a OEM bespoke computer (ASUS) motherboard.
Windows activation is based on a cryptography key which is generated against the serial numbers of the hardware ( MS OEM licence to stop you replacing Motherboards etc, In licence terms this is swapping your OEM XP lience to a new computer which is illegal). The problem is that XP does not nativly recognise the motherboard (chipset driver like Intel or Via) to generate the activation key from.
I am making the assumtion you hve a valid OEM version of the software and product key and are repairing the O/S on the same hardware.
install windows as usual if you have not already on first boot it will ask you to log on then immediatly ask you to activate.
Restart the computer and hit F8 key once the bios has finished, to show boot options for XP. Select Safe mode not safe mode with networking and then you should be able to get into windows, ( we had to do this part twice to get in to windows in safe mode without the activation. then check device manager and you should see an number of unrecognised devices. download the motherboard, video and network card drivers for your motherboard from the manufacturers website. put on a cd usb key or floppy and install on the computer. you may have to restart and do each driver on at a time and re-enter safe mode each time. once the drivers are on and recognised the activation key should come up allowing you to activate over the internet or phone.
Seems to be the key cannot be generated against the hardware until the specific motherboard and built in hardware drivers are present and recognised. on first XP install it is most probably the basic generic IDE, BUS, controller drivers that are loaded.
When we called Microsoft activation they had no clue and wanted us to call the chargable support no.
Hope this helps.
Regards
Mark