Since you have made videos before, I don't need to know how you proceed and certainly that if you used the sample pic that none of the files you are trying to import are not corrupted and are in the right format.
So the source of the problem must reside with your fresh XP installation.
As a first step, I suggest that you click on start, all programs and on Windows update. I suspect that some .dll is missing or was not installed properly. Windows has issued some updates for Win XP.
Please let me know, because making videos is fun.