1.66GHz Core 2 Duo MacMini/Bootcamp: Install Windows XP from USB thumb drive...impossible?

My goal

Take my old MacMini out of storage and set it up as a Windows XP box for my father-in-law. He's older and has always used Windows so I don't want to confuse him with a switch to OS X.

Specs

MacMini (macmini1,1)

1.66Ghz Core 2 Duo

2GB RAM

60GB HD

OS X 10.6.8 Snow Leopard

Problems

I have no CDs 😟 The original CDs for the Mini are long gone and I can't seem to locate my Leopard/Snow Leopard CDs either. Even my WinXP install is just an .iso

Approach

1) created a bootable USB thumb drive from my Windows XP .iso

2) set up the partition scheme on the Mini using Boot Camp Assistant

3) plug in the bootable Windows XP USB thumb drive

4) mount the XP iso that's still stored on the Mini's hard drive using hdiutil (hdiutil mount /path/to/my_win_xp.iso) so Mac thinks CD is present

5) initiate install from Boot Camp Assistant

6) installer boots...

...and that's where everything goes to pot. The machine boots to the thumb drive and gives me a selection of disks/partitions to choose from or a method to proceed to install. I've tried pretty much everything in the list. At one point i got as far as the XP installer going through it's steps. however on reboot i get the infamous hal.dll error...

"Windows could not start because the following file is missing or corrupt:

<Windows root>\system32\hal.dll.

Please re-install a copy of the above file."

Which seems to be mostly meaningless...at least that's what my Googling tells me. Anyone had any success with a similar approach? I've not had any luck finding a solution here or on google yet 😟