Rwandamark, I located your same issue here within EE. The problem is based on a system that has XP Home with SP2 (that's important) and the upgrade CD is XP Pro BUT with Service Pack 1. XP will not allow an "upgrade" if the installed service pack is higher than the one attempting to load with the upgrade OS.
In short, the answer was to uninstall the current Service Pack, reboot and attempt the upgrade as usual.
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by: j210277Posted on 2009-09-17 at 15:47:58ID: 25361819
http://www.mydigitallife.i nfo/2008/0 6/13/conve rt-and-upg rade- windo ws-xp-home -to-profes sional-wit hout-reins talling/