Well, I’d get rid of the 5gb drive. It’s probably doing absolutely nothing, and some of the older hard drives don’t mix well with faster drives. I’d put the 160gb drive in place of the 5gb drive, and if you need to, copy the data off the 5gb drive to the 120 temporarily, and then move it to the 160.
Mixing NTFS and FAT 32 won’t hurt anything, windows XP deals with FAT 32 just fine. I’d format the new drive in NTFS anyways (XP doesn’t give a choice for drives over 32gb anyways), because it’s more efficient, and fragments less. There’s not a 10% difference in performance between NTFS and FAT 32, there is a difference, but it’s dependant on file size. If you play with the cluster size when you format the drive, you can get better performance out of NTFS, depending on your usage. I suggest leaving it default, especailly if you create and delete large files like I do all the time, because bigger clusters make more fragmentation.
The placement of the drive on the cable doesn’t matter of you’re using the jumpers, you can set the drives any way you wish, and plug them into either spot on the cable. The only time cable position matters is when using the cable select position on the jumpers, and I’d suggest not using it. Cable select can create a lot of headaches, so use your jumpers.
Once the drive is installed, go into the bios and make sure that it’s recognised by the bios. It should be under the IDE configuration, maybe on the advanced cmos features depending on the bios. It should list the hard drive while the machine boots too if you don’t enter the bios. If you go into the IDE menu, you might have to tinker with it to get it to identify the hard drive. Just make sure the bios sees it. Then let it boot to windows, and it should pop up with the stuff saying it found new hardware. After it installs all the drivers, right click on my computer, and go to manage. Go into disk management, and select your new 160gb hard drive, format it and assign it a drive letter. MAKE SURE it’s the 160, and not your boot (system) drive!!! I don’t think it will let you format the system drive anyways from inside windows. So after it’s assigned a drive letter, the drive will be ready to use. You must have service pack 1 or better to use your 160gb drive, or it won’t see the whole thing. Good luck, hope that helps.