I'm not quite understanding your problem, Andrew:
What do you mean by "I ripped it, but I ripped it into the entire Disc's contents..."?
1) Do you mean that you copied the entire disc to your Hard drive in the root folder of your HPF+ system partition, and it was spread out over the entire HD? As far as I know, it is not possible to do this on an HFS+ volume.
2) Do you mean that you copied the entire disk into a single folder on your HD? IF so, you have not done anything anyone else does when copying a Microsoft distribution disk. Just use Disk Utility to create an image of this folder, and then burn it to a CD or DVD.
3) Do you mean something else?
As far as I know (and I've been using Windows for many years, (since Windows 1.0), it is not possible to "rip it into the entire Disc's contents..."
Now, it IS possible to copy the disc into a folder on one's HD, then incorporate a Service Pack into that folder, which would "rip it into the entire disk's contents" (i.e., "slipstream the Service Pack into the XP installation media)".
Additionally, please let us know a few things:
1) HOW did you "rip" your friend's disk? Using which OS? Using which program of that OS? All that is necessary is to straight-forwardly "copy" the entire contents into a SINGLE FOLDER on your HD (but NOT the root folder), then send that through a program which can create ISO-9660 images and burn them to a CD or DVD.
2) Did you do this from within OS X? From within XP? From within Vista?
3) Please tell us exactly WHAT steps you took to obtain your initial results.
If what you say is correct, it is completely "legal" to use your friend's disk with your CD key, and come out with a completely legal licensed copy of Windows XP.
On the otherhand, if your Key was bought separately from the distribution media, you cannot have a result of a "legal" license, since Microsoft does not allow the sale of stand-alone COA [Certificates of Authenticity, containing the installation Key]. This means that any such stand-alone keys are not authorized by Microsoft, and therefore, cannot be licensed by Microsoft, whether the key is able to be activated or not.
Please do not take this the wrong way. I am definitely not accusing you of anything, I am just giving you necessary information. What you do with it is up to you.
I don't understand what you are saying. This is why I need further information. Please do not tell us any more about HOW your key got separated from the distributioin media, since this is a public forum.
What is really important here is exactly what you mean by "I ripped it, but I ripped it into the entire Disc's contents..."?
Without a fuller understanding of exactly what you mean by that, it will be very difficult to offer any solution or advice.
Sorry,
Donald L McDaniel