Good morning! [sip]
A couple of thoughts, some or all of which may be completely wrong:
WRT the wife's computer: It doesn't seem likely that the Windows install has Office already in it. Aren't you talking about different sets of CD's? There's Windows XP Pro, and Office XP Pro-- different things. I really, really wish MS would stop naming them the same because it is really, really confusing.
Important question: Did her company provide new shrinkwrapped copies to install at home, or are they merely letting employees take their work copy home to install there?
If it is just the work copy, it is probably already registered with MS as having been installed on another machine and you'll be unable to register it again. This will disable it after some time. If it is the corporate edition without a registration key, it will work but it probably is a violation of the license.
If it really is a new copy with its own key, you can install Office Pro over the top of the old version of Office. No problem.
I would NOT recommend doing this with Windows XP Home upgrading to Windows XP Pro. It is theoretically possible, but will likely be more trouble-free to do an entirely NEW install of windows instead of the 'upgrade'.
[sip]
Thanks, I'll need to look at the actual disk. I'll do that post drugs...