I remember back in the old days, there was an allocation bug in windows xp. I think it had to do with 32 bits allocation vs 48 bits allocation (or 42 can't remember exactly anymore).
Are you installing you pc with a pre-sp2 cd of windows XP? If i remember correctly it was fixed in there. Otherwise you could use a partition manager (e.g. Partition Magic) to increase the size of your partition or slipstream sp2 into you windows cd and reinstall your system.
(you could offcourse always settle for 2 partitions. that way the remaining 80gb would make up a second drive-letter in your Windows).
<edit>
This is the Microsoft KB.
http://support.microsoft.com/kb/303013/en-usAnd i was wrong... it's pre-sp1 instead of pre-sp2
</edit>