Koala" is Ubuntu 9.10, and is usually called "karmic" for short - it sounds like your friend used the option to install karmic as an application within XP. This is known as a "wubi" install
Generally you need to manage a wubi install from windows - just like any other windows app.
You can copy C:\ubuntu\disks\root.disk someplace, install XP, install another wubi, copy this file back.
Alternately, since c:\ubuntu\disks\root.disk), is seen by Linux as a real hard disk, (says the wubi web site) it is probably possible to mount it. Copy it to ~ then:
sudo mount -t ext4 ~/root.disk /mnt
I've never tried this, so I checked
- which suggests there will be better luck via...
sudo mount -o loop ~/root.disk /mnt