Installing XP on Vista

Hi, I'm planning to buy ASUS F3 Series F3SV-B1, which has Vista Home Premium loaded. But I'm not sure whether if the programs I use with Vista are compatible, plus I don't trust it that much, so I'm thinking about installing XP also. Btw, if you want to see a complete information of the laptop, follow this link: http://www.newegg.com/Product/Product.asp?item=N82E16834220162.
I am also planning to buy an external HDD, either 500GB or 750GB.
It will be either
1. Western Digital My Book Premium WDG1C7500N 750GB
or
2. Beyond Micro BM500MD3CS16M 500GB
depending on the budget.

The questions I want to ask are:
1. Is it possible to install XP on the external HDD?
2-1. If so, what kind of procedure should I follow?
2-2. If not, how can I install XP on the same HDD of my laptop? I'm not skilled in software and OS wise, so I'd really appreciate if someone would tell me from the very beginning. i.e. how to divide partitions of the hard drive.

Thank you for spending time reading this question, and hopefully someone could answer my question soon!

 

1) you can, but it would be dog slow to run an OS off of an external drive
2) dont bother
3) all you do is boot off the OS cd, choose which partition to format, then you follow the onscreen instrctions as it installs

 

So I guess I'll have to install those two OS's separately. Can anyone explain, in detail, how to install XP on Vista pre-loaded laptop? I'm asking this because I'm not completely sure which way I should choose among hundreds of methods that appear online when I search. It'll be also fine for someone to tell me which method from which website (preferably a link) I should follow in order to do this. Thanks!

 

If you found "hundreds" why are you looking for one more? I'm sure you found several that work. Just read the feedback from people that have followed that particular method.

Also, try using the search tool in this forum. The topic of dual booting is pretty common.