While you can't actually run Windows XP on your iPod (at least not in any way that this author has heard), you can now use it to carry your preferred Windows environment with you to run securely on top of any computer running Windows XP. MojoPac (http://www.mojopac.com) encapsulates your applications, files, settings, and preferences on a portable storage device in a way that allows you to move from machine to machine without leaving a trace and without worrying about the (in)security of the underlying system.
This type of solution could be great for people who use many different machines or frequently use public computers. Similar solutions include: U3 (http://www.u3.com/), Ceedo (http://www.ceedo.com/), and Thinstall (http://thinstall.com/).