That's good to know. I'd like to try installing Kubuntu Linux on this X41T some day. The machine that I run it on now is a Shuttle SD11G5 desktop PC with a Pentium-M that's configured similarly (same video, 1 G RAM, notebook HDD), and everything works fine, so the only unknowns are wireless and the Wacom tablet & pen. But I've read other posts that claim most of the X41T hardware is supported well under Linux.
I'd have to take issue with the speed -- my desktop is a 2 GHz Pentium M running Linux and it's not as fast as the X41T with a 1.5 GHz Pentium M running Windows. However, if you're comparing Linux to the IBM Windows image then I can understand.
I don't know how you'll install >700 MB of Windows files with a floppy; that will be a real challenge! Your best bets are to either borrow a USB CD drive or try installing from a USB memory stick. Or, here's a link to a good article on how to do a PXE install of XP (pdf document):
I was going to try this but instead took the easy way out and borrowed a CD drive!