Maybe Ghost 2003 does not support WinXP SP3. Did you try to get any updates from Symantec or Live Update? I would also try a new install of Ghost after the upgrade to SP3.
DriveImage XML is free and very easy to use. Keep in mind that it cannot restore an image to a smaller hard drive than the original one. The only thing you have to do to restore an image is to build something like the Bart PE boot CD. It is a Windows XP "live" CD. You can boot from it and run DriveImageXML from there. I haven't try the solution you wrote about the USB. Bart PE seems simpler to me. If you do a google search you can find guides how to build Bart PE with DriveImage XML plugin.
Another free alternative is Macrium Reflect, which has a wizard to build a bootable (linux) CD for the restoration process. Imaging is done from the running Windows XP session, such as DriveImage XML.