I want to do a format & reinstall Windows XP on my htpc, which does not have a cd drive. It's a small mATX case and a real PITA for me to get remove my dvd drive and get it in there just for this task ...

Optical drives are still practical for many users, whether to play old CDs and DVDs, install software, or create backups—especially with modern laptops, which are usually supplied without a drive.