So, after I install the OS, will it prompt me to do the drivers CD or do I need to shut down the computer when the OS install is done and then put the drivers disk in and then reboot?
Step 1: Save all relevant data personal files, photos, music, etc.) from your old install (if applicable)
Step 2: Place the Windows XP CD into your optical drive and boot to it from either BIOS or pressing F8
Step 3: Install Windows
Step 4: After it's fully installed and you're at the Windows Desktop, remove the Windows XP CD and put in your MoBo's Driver CD. The Driver CD may or may not have an auto-run feature, so give it a few seconds before you try to open anything. Most drivers will need to be installed separate from others, so you may have to reboot a bit. Please note that there is no set order to install the drivers, so either go right down the list or skip around, just make certain you load them all. As individual ones are loaded, you'll receive corresponding messages/input (ie: Windows will find a network connection after LAN drivers are installed, and you'll hear the Windows Logoff sound after you install the Audio drivers and reboot).
Step 5: After all drivers are loaded, access Windows Update (see below).
Step 6: Enjoy
will XP SP2 be a part of my update process
Yes. Once Windows is installed and the drivers are loaded, you will need to update Windows. This will be done in a few steps. First, Windows Update will install WGA and a few other updates, then prompt you to reboot. When you use Windows Update next, it will install a lot of updates, then prompt you to reboot. SP2 must be installed separate from other updates, so when you use Windows Update again, it will download and install.
SP2 is a large update, so it will take a bit to download, and a very long time to install. At one point, the status bar may appear to be stuck around 60-80% of the install, but just stick it out - all is good and your system is not frozen.
Edit: Note that for XP or XP SP1 install CDs, there can be a LOT of updates, so getting your system current with all patches, etc. can take a few hours as things are downloaded and installed.