How to resize the primary Windows XP partition?

You cannot resize Windows system partition while being booted from that partition, so you should use an external tool for this purpose.

Personally, I prefer PartedMagic: it is a very good and stable Linux-based partitioning tool which you can start from CD or a flash drive. The interface is obvious enough, but if you have any questions, you can leave a comment.

Try EASEUS Partition Master. You can run this from Windows itself, and it's free for home users.

You could try to boot from a Linux live CD and run Gparted, it may work for you.