I have been through this scenario myself. If you are using a WinXP upgrade disk to upgrade ME to XP, that can be problematic.
The italics above present the best option (in my estimation) and is my standard operating procedure when upgrading anyone's machine to XP. Install XP to a new drive ( a biggun') and use the old drive as a slave unit...moving documents and data at your leisure then using your old Program Files directory as a guide to what needs to be installed on the new drive.
Heck, you can even create a new folder on your new drive called "Old C:drive" and copy all the old drive's contents there then toss the old drive and get a new big one as a slave drive for snapshots for backups using Norton Ghost (the ONLY Symantec product worth using).
Unfortunately, it would entail purchasing a new copy of XP since the Upgrade disk will not install clean without the presence of a pre-existing Microsoft OS.
But, there is hope. If you can get your hands on a copy of Windows 98, install THAT first on the new drive, then upgrade to XP with your Upgrade disk. That should work....just use your ME disk and do a clean install of that first, etc, etc.
Bon Chance mes ami!