You don't unplug anything while a system is running. In order to copy the files you are trying to save from one drive to the other you first open two explorer windows. When you double click on the MyComputer desktop icon or go into "Start>Programs>accessories" to click on Windows Explorer a window opens up showing the default folders(user name's documents, shared) and the drives on the system. You open one drive in one window and the other destination drive in the second window opened.
Highlight or right click(choose copy in the right click menu) on the folders/files to be copied from the source drive to the destination drive by then dragging the highlighted items to the other window or again right clicking in it and selecting the "paste" option in the right click menu. The "copy/paste" option is the more commonly used. Since the 320gb drive is already partitioned and formatted the XP installer will readily detect and copy the installation files right onto it for the clean install of Windows there.