You cannot install XP over Windows 7 from Windows 7 ... you must boot to the XP CD in order to install it over Windows 7.

If you boot to the XP CD, it doesn't matter what is on the hard drive (in fact, you can boot to your XP CD with NO hard drive installed at all) ... you can simply delete the partitions that Windows 7 is installed on from the XP setup, then install XP on a new, empty partition. 

When you say "I can't" ... can't do what?  What is the problem or error message?

When restarting the PC, it doesn't show XP  cd I tried pressing F8,F2 to get it started from CD/DVD but it keeps boosting windows 7.

I can't. That's what I'm saying. My friend has said I would need to delete windows7 all-together to run the CD for XP.

The screenshots are all what happen when you try to install XP from Windows 7 ... you can't do that.  You MUST boot to the XP CD.

Then you will need to make sure of a few things:

• The CD is in fact bootable (and actually boots) ... try this on another machine.  (Where did the CD come from ... did you or your friend burn it yourself?  How?)
• Ensure CD/DVD and/or SATA/IDE is on in your system's BIOS (whichever your CD drive is connected to should be set to ON).
• Ensure that the CD/DVD drive is listed in your BIOS boot order.  On some systems, it is not enough to simply be in the boot order, on some systems you must also enable it in the boot order (enabled devices have a checkmark or star next to it).

On most Dell's, F12 give you a boot menu, giving you a one-time, manually-selected boot device.  Try this and select CD/DVD/Optical drive.

Hi, well I've tested it out.

• The CD I've tested on my old laptop. The files started to run and was working, but 15+ seconds later writing came up saying 'Something something, HARDWARE ON THE COMPUTER, VIRUSES, INPUTS' So I'm guessing it was my old Laptop and not the CD. I then ran it on my new computer(the one I'm currently on). 10- Later an error comes up saying' File \i386\KDCOM.dll could not be loaded. The error code is 7'.
• My friend told BIOS is the brain of computer, so if I mess something up my PC won't work, so I haven't even attempted to try.

That's all I can give out sorry.

I'm sorry, but I think you should listen to your "friend" less whe it comes to computers.  I'm not suggesting updating the BIOS (which if it goes bad can mess up your computer - however this is extremely rare).  I was suggesting booting to the BIOS Setup (F2) to check the boot settings to make sure you system is set up to boot to your CD drive.

There seems to be something wrong with your XP CD (assuming you did as I suggested and entered BIOS to check boot settings and/or tried F12 to boot to CD).  It doesn't boot on this computer or on your old laptop.  Did you create/burn this CD youself, or is this a branded (Microsoft/Dell) CD?

The branded Dell CD. 

I'll look @ F2 and see if I can work around it.