Adhyapika - you should start a new thread for your question.
Do I take it your current (failing) hard drive is a Maxtor SATA drive?
What type of drive is the new one? If its IDE, then yes you can make it master on IDE primary controller. If its SATA, then master/slave doesn't happen - just one drive on each connector.
Then you're talking about putting it in an enclosure. Once in an enclosure, then yes you can partition and format it from any XP machine using disk management (run diskmgmt.msc) on the external drive.
But not sure what you're trying to do. Do you want to install XP on the new drive in your machine - and then possibly try to retrieve data from failing drive?
If you want to do that, connect new drive to machine (and disconnect the failing one for the time being). Boot from XP install CD - if the drive is SATA you'll probably need SATA drivers on a floppy (you say you've got a USB floppy) - should be available from Dell) - press F6 when prompted at start of install and then present flopy when prompted. If its IDE just proceed as normal. You'll get the chance to create and format partition later. Once installed (you'll probably need to get other drivers from Dell site too - unless you already have on CD) you can try connecting failing drive to see if you can access it. You'll need to re-activate your XP - may need to phone them, but if so, just answer questions (once they've established hardware failure should be no problem).
