I came across this.
I'm sure there's another way to do it.
But anyway it works great.
You have to slipstream  SP2 into it if like me you have an old XP home SP1 disc

http://www.vnunet.com/vnunet/downloads/2157730/nlite-rc8

I also found this tv program about it.
Towards the end of the program they talk about the program.

http://dl.tv/blogs/digitallifetv/archive/2006/01/26/5104.aspx

I downloaded it then went straight to the end of the program.
I got my copy of SP2 from here.
Because I wasn't sure where to find SP2 on my PC.

http://www.computeractive.co.uk/computeractive/downloads/2158543/microsoft-windows-xp-service-pack-2

At the end I got a win rar iso file that I brunt as an image file.
It seems to work OK,the real test will be when I reformat some time.
Maybe somebody would like to try the whole thing out.