I have received many emails and one blog comment about LitwareHR needing Windows 2003 to run. The reason is explained here.
Note that you can download a virtual image of Windows Server 2003 here (free eval copy). You will of course need Virtual PC to run the image. BTW: we also just release Virtual PC 2007 (free as well) here.
Hopefully with all this you will be able to have a running copy of LitwareHR on your XP machine.
Worst case scenario, you can always:
– read the documentation
– look through the code