XP will run on the 560. I would consider adding more memory (RAM) to your laptop.
Unfortunately, XP can only be installed on one computer. There's nothing (legally) you can do about this because XP home requires activiation after a certain period or it will quit working properly. When you get your activiation code, Microsoft knows that you have used the cd-key before on another system.
As far as the street price is concerned, you got a good deal. Something like that might sell locally here for about $300+
To get around the key situation, you can call Microsoft and tell them you got a new computer and are transferring your XP installation. They will give you a new activation code. You won't be legal though.. Not for both systems and you may have problems in the future if you ever have to reinstall your OS etc..