First of all be aware that Windows XP is out of MS product lifecycle (http://support.microsoftcom/lifecycle ) since April 2014 !

However, if you should face the following issue…

On a single Windows XP SP 3 workstation you receive the following error message when installing MS Dynamics AX 2009 SP 1:
Update "Service Pack 1 for Microsoft Dynamics AX 2009 Components (32 bit) (KB956568)" could not be installed. Fatal error 1603.

.. then check out the following Windows KB and make sure your work with local administrator permissions when you perform the installation!