You'll have set the cddrive as the 1st boot to install XP.
-- If you are overwriting W7, quick format the partition that has W7 and install XP there.
-- If you are going for a dual boot system, create a primary partition or use a fresh HDD to install XP. After XP installation, you can boot to your W7 media (CD/USB stick) and perform a repair install to create the bootmanager that allows you select either W7 or XP after POST.