Okay fellas, here's the deal with Compaqs and restore media. Believe me, I know about this (I hate my job sometimes)...
Boot the PC. When you see the red "COMPAQ" logo on the screen during post, press F10 a few times. That'll start the recovery process- you can either Repair the existing installation or perform a Destructive restore to get rid of everything and start fresh.
The restore files are held on a FAT16 partition, usually hidden from the system, and F10 invokes the boot loader hidden on that partition.
Unfortunately, it is entirely legal for them to do as they provide the XP installation files on that partition. However, all laptops come with XP CDs from Compaq as they don't have the space for a hidden partition because their hard disks are smaller. Go figure 🙂
Anyway, you don't have any real way of wiping that partition unless you fdisk it, so don't worry about it. Norton Ghost can back that up to CD or HD with no problems at all (and it works, too).
Don't mean to be a jackass, but most of what I just said is in the manual.... 😛