Is there any (free or low cost) solution that would allow me to take my physical laptop with WinXP installed on it and convert that to an image that I could load and run on VirtualBox on a different Linux desktop machine? I'm not looking to buy a full-blown version of VMWare that I assume would probably allow for this. I want to do it for free or very low cost, or not do it at all. The virtualization software on the Linux box does not have to be VirtualBox, but that is what I am currently using, so I'm familiar with it.

It is not a free project no matter what, since Microsoft requires that you purchase an additional Windows license for the virtual machine (and we do not discuss how to circumvent this legal requirement on this particular forum).

Additionally you will run into the problem that Windows XP has only 3 months support left; it will soon be obsolete. (But perhaps you know this, and it is your motivation for virtualizing? )

Technologically I see no issue with it. I haven't tried TobiSGD's link, but it looks promising.

I think for that you need to use some disk cloning utilities. Then use the image created to boot and reinstall. I can only imagine it will be a pain in the bum for the hardware being all ripped out from the system point of view.

I suggest a fresh install and files restored from backup or copied over.

Actually this is for my work laptop. We are switching to Windows 7 (I guess you'd call my company a "late adopter"!) Anyway, this is only a very temporary thing. While I am upgrading my company owned laptop to Win7, I must remain available for work emergencies. So I thought first I'd take the existing WinXP laptop image and put it in a VM on my home Linux PC (I work from home). That would give me (1) A backup of my WinXP from which I could copy files to migrate them to the new Win7 install, and (2) Something I could potentially restore from (an iffy proposition) should the Win7 install go terribly wrong, and (3) A temporary place to work from during the laptop downtime during the upgrade to Win7. Total time that this VM would be in existance would probably be two days max. As far as I know, our corporate copies of Windows do not require activation, and even if they do, it's no like I will need an activated copy for the two days max I would be using the VM. I can go without the Microsoft updates for those two days. It is my assumption that WinXP would continue to work in a VM for two days, without activation if that is even needed for our corporate license, but I wouldn't be able to get any updates. I don't care about the updates being denied. WinXP will be totally gone once the upgrade to Win7 is successful.

I have no desire to extend the lifetime of WinXP by virtualizing. Nor do I even want to use Windows at all, but that's what is required for work. I am not looking forward to having to use Win7 for work. WinXP is bad enough to be forced to use, but at least I am familiar with it.

A quick Google search of answers.microsoft.com suggested there is a 3-day grace period for Windows XP activation after a hardware change, so if I am interpreting this correctly, you should be fine for your 2-day project. Of course your corporate IT would know much more about the specifics of your agreement with MS than I would.

Almost all of the user type vm's are free. The official MS way is to make a ntbackup with system state and then apply it to the installed VM's new xp install.

The problem with that is your OEM windows won't install on the new virtual hardware unless you have a real full or maybe upgrade disk.

If one took any other tool like clonezilla or dd or ghost, one would have a fail on hal unless they tried to add in all the drivers before the move. This isn't easy.

I've used P2V apps before and one of them did change the hal and fix the authentication.

Corporate copies of Windows are not OEM installations and should have no problem to install in a VM.

Legal concerns aside, it can be done, only thing is to make sure you removed all proprietary drivers (video mostly) from it beforehand and use the same type hdd controller - ide if the hdd was either real ide or sata and used ide emulation, sata if it used sata with ahci - as you had with the real machine.
Then just make a dd copy of your hdd (you will end up with a raw format image) then attach it to a VM (has to support the raw format, most VMs do AFAIK) as a hdd and cross fingers.
Now i done this with Windows 7 and worked with no issues (ironically it booted in qemu, but it bluescreened if i put the hdd in another physical machine). But XP is more finicky than that sometimes so YMMV. I even used the actual physical hdds to boot from, attached the whole block device (/dev/sdX) to qemu VMs (this feature may not be in vbox though).
Typically if the laptop had intel components and you removed other drivers such as nvidia (if any), it may work since VMs tend to emulate bog-standard intel components. If the real machine is say, AMD, best is to remove any user-installed drivers beforehand.
Anyway experimenting with hdd images isnt harmful.