Hi Kavi, welcome to NST.
Is your XP CD a recent build ?
If you're using a very old XP (pre-SP2), there's a chance that it won't have the drivers for your HDD, which could make the install more difficult.
The Vista licence that came with your laptop represents a fair portion of the money you paid for it, so you shouldn't just junk it without any thought.
Why don't you consider shrinking Vista and installing XP in the space you create as a dual-boot.
That way, you'll see whether XP installs easily without losing your ability to use the machine, and you can run your office work from XP and still have the benefits of some of the later, better, bundled software in Vista.
Have a read of the
sticky thread early points and follow the links to read up on how to dual-boot before you make up your mind.
We're always here to help you get it right.
If your XP CD is recent enough to contain SATA drivers (SP2 on), you shouldn't have any problems installing XP (by itself or in a dual-boot), though you'll probably spend some time getting drivers for all the features of your laptop in the immediate post-installation phase.