Software is available to run an iso image of the cd, loaded on to the hard drive, as a virtual cd. if I remember rightly there is a free download of the software available on the microsoft site. This also allows you to run those products that require the cd to be present in a cd drive. copying all individual files to a usb drive sometimes works but can take a long time to copy all files, producing an iso image is quite quick.
I just this last two weeks bought a Samsung Netbook running XP home. You could do what I did Start both Computers and any Printers you want to be able to print to, on the XP computer go to Control Panel Networking Wizard run the Wizard to create a Network its easy just answer to questions it asks then Create a USB disc Using USB memory Stick when it asks you to create a disc. Put this in the Netbook and double click on the single file it creates to setup the Netbook. After you have done that Go to the XP comp with your CD put it in right click the drive Click Properties\sharing then set the drive to share in the Netbook you need to go into Windows Explorer by pressing Windows Key with Flag on it plus the E key to start Explorer. Bottom left you will See Networks Expand them till you find Mshome network you should see the drive there double click it and look for the Setup file of the Program you want to install double click it and it will install on the Netbook. Just loaded a big program today but its a a bit slow over a network, but it gets there in the end