how big a partition do you think i should split off for XP sp2?
This soo much depends on what you intend to install.
For instance, stuff like Office / Nortons and many other programs use .DLLs that hook into windows, so if you formatted the C: partition at a later date thinking you wouldn't have to re-install the 2 progs I listed, you'd be wrong.
I would only ever use another partition to back up me music / documents etc.
Steam (half life CS etc) is a fine example of not using windows .DLLs, and that can be put in another partition without need to re-install, but many other games can't.