I hope this helps someone else. I came across this when trying to install XP on my HTPC, which currently lacks an optical drive, and being too lazy to swap out the one from my main computer. There are a few ways I've seen, but this one appears to be the easiest:
http://www.vandomburg.net/inst...g-windows-xp-from-usb/
http://www.vandomburg.net/inst...g-windows-xp-from-usb/