I would recommend at least doing a Repair Installation from the WinXP CD, even if they're within the same motherboard family. If you want to do a full format, and you have a second partition, you can stick all your data on the other partition and just format the boot partition (ie, the "C drive"). Your data will be fine.
Take a look at this Anandtech FAQ to answer your question. Yes, you can move everything over to another partition to keep it safe. Just don't fdisk the drive and make sure you format the correct partition. Don't ask how I know the latter.