It should be fine as long as you install XP to the same drive and paritition it was on. However, you well need to either disconnect the first drive containing Vista during the setup or prepare to restore the Vista bootloader from a recovery disc/Vista DVD after the installation. You should also check to verify that XP's boot files (ntdetect, ntldr, and boot.ini are on the root of Vista's partition. You'll need to enable "Show hidden files and folders" and uncheck "Hide protected operating system files" in Folder Options in order to view them.
If they are not located there, they should be on XP's partition. I would go ahead and copy them for later use if needed.
After the XP installation, reconnect Vista's drive and/or repair Vista's bootloader. Verify that the entry that you previously had well boot the new installation. If it doesn't and you orginally found XP's boot files at the root of XP's partition rather then Vistas', copy the backups you made of XP's boot files back to the root of XP's partition and try again to use the existing entry.
If the above doesn't work, try making a new entry for XP and deleting the old one.