I installed the VirtualBox on my machine.
I have the Windows XP IMG file.
I converted the IMG file to a VDI file using VirtualBox command line.
How to setup a new virtual machine using either the IMG or the VDI files.
I followed the instructions, but I received the following error:
FATAL: No bootable medium found! System halted.
Here are the instructions that I followed:
http://www.linuxjournal.com/content/using-windows-xp-virtualbox-linux
the IMG file you have of the XP Installation disk is to be mounted as a CD disk when you have the VDI created.
look at this (final) picture of the installation:

(source: linuxjournal.com)