I've found the Windows XP Files and Settings Transfer Wizard (FAST) to be a great tool...you just run it on your 'old' computer, run it again on your 'new' computer, and voila!...your old desktop, files and network connection settings all appear like magic. 

I just had a problem, though, that caused a little panic.  The situation was that the 'old' computer and the 'new' computer are the same machine.  I ran the wizard to an external (USB) drive, formatted drive C: and reinstalled Windows.  When I re-ran the wizard, I got a message that apparently means the FAST backup is corrupted:

"The location that you specified does not contain any stored information."

The solution (for me, at least) was to run Windows Update until there were no more updates to be had...install everything.  After that, I re-ran the wizard, and the files restored beautifully.  Bottom line...the data wasn't corrupted at all, but for some reason Windows couldn't see it. 

A few extra minutes of preparation would have prevented the panic.  One good suggestion is to run the wizard on the 'old' computer right after you do the FAST backup.  If it starts to restore your data, you're in good shape.  If you get the above error, delete the backup and try again.  Thanks to aumha.org for the tip (though I didn't find it until after I was dead in the water).