for xp anything is simple- go to microsoft homepage,select products. SP3 update includes previous version of Sp2,so you shouldn't have problems at all. if that all fails,try this- backup all of your data at external HDD,get a copy(I would suggest original Xp,it's not so expensive and you will have less headache later),go to BIOS,select your cd/dvd rom as first boot device,insert your Xp cd and exit,by saving changes. When it boots up,you should recieve ar request- press any key to boot from CD. Press it,follow instrukctions and select- repair xp(due to some reason,some of your files may be deleted,that's why you should back up your data. Probably you will need some drivers too. If there's something wrong with your OS,it will be repaired from CD. After repair,go again to BIOS,select your primary boot device(your HDD),save and exit(will be another restart),after that you should be able to update to SP2 and get your update for SP3. Of course- SP3 is availabile only,if your copy of XP have passed Geniune validation check. If you have pirate copy,you don't even need to try this- it won't work.
About your error- ntoskrnl.exe is a critical process in the boot-up cycle of your computer although should never appear in WinTasks whilst under normal circumstances, It provides the Kernel and Executive layers of the Windows NT kernel space, and is responsible for various system services such as hardware virtualization, process and memory management, etc., thus making it a fundamental part of the system. It contains the Cache Manager, the Executive, the Kernel, the Security Reference Monitor, the Memory Manager, and the Scheduler, among other things. If it's corrupted(as it seems),you should simply repair it(using CD as I said).
Second thing why are you getting this- your PC's drivers may be out of date. This may cause hardware failures, conflicts and even complete system crash.
