It is not possible to boot WinXP from a USB-Mass-Storage-Device which is not a supported boot device under Windows XP. This issue is related with WinXP, since it doesn't allow booting from a removable drive.
XP Embedded or WEPOS allow booting from USB.
Use a IDE hard disk to install Windows XP on Woodpecker or use Windows Embedded Standard, XP Embedded or WEPOS.
