Most systems come with an image disk not the Windows XP disk which is a problem if you never installed the recovery console on your system (adds an entry into the boot.ini file enabling you to boot into the recovery console without the XP CD).
Things I tell my frieds:
1) purchas an external Hard disk
2) do weekly full backups (minimum...depends on how much you do with your computer. My computer at the house is just a Internet playstation for my kids so I only do a full backup once a month or when I copy new pics to my photo ablum.
3) When a failure like yours happens all they have to do is blow away their existing OS using the DVD that comes with their system and restore their last full backup.
