If that was your current desktop system then I'm guessing you probably don't do any recent gaming? In which case, any reason to bother upgrading it right now? The only thing I would suggest is to max out the ram, and maybe try out Windows 7 32-bit in order to get past the numerous security issues associated with continuing to run XP. But you might need to disable Aero to get acceptable performance.
Well, something that old is probably kind of sluggish even for day-to-day browsing on today's media-rich web.
@OP - I'd say wait and see if the new laptop is good enough for everything you do. If not, then think about building a modern system around budget components. You've clearly got pretty modest needs desktop-wise, so a micro-ATX mobo, AMD APU, and 4GB of RAM should be leaps and bounds ahead of that old Athlon XP in terms of performance, while remaining quite affordable.
If the world isn't making sense to you, you're either drinking too much or not drinking enough.