You do not need to uninstall anything. Just boot your 12.04 DVD and during the installation process you'll have a chance to format the old Ubuntu partition and install a new version on it. Be careful. Make sure you're installing Ubuntu on the right partition. Otherwise you might overwrite your XP installation. Before you do anything, make sure you know your partition setup. From the existing Ubuntu installation, you can use gparted to identify your existing linux partition.
Now for the second part of your question:
You need to be more specific and descriptive. Does it boot of a DVD at all? What happens?