Windows doesn't include the drivers you need for it to be able to see a SATA drive. Here is a link to show you how to do an install of XP on a fresh SATA drive click here
Incidentally, when I was trying to put XP on my SATA drive I didn't have any drivers. I bought it OEM, so I had to go searching on the internet for them... no floppy disk either so I burned them to a CD. Luckily I had a working laptop that I could do all this from.
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