Here's how to install a USB wireless receiver with Windows XP - tell me whether you are following these steps:
1) Boot up, log in and insert the driver CD.
2) CANCEL the CD window! It MUST NOT be running.
3) Plug in the adapter and wait for the New Hardware Found wizard.
4) Point the wizard to your optical drive in its search for a device driver. Complete the wizard.
5) Reboot, with the device plugged in.
6) Connect to your wireless LAN by single-clicking on the WLAN icon in the Notification Area, refreshing the network list, choosing your network SSID and connecting to it.
7) Enter the WPA-PSK if you have enabled that feature and create a firewall permission if/when your software firewall prompts you.