ok Im pondering buying a mac pro once they release the updates and I am wondering if I can take a 3.5" SATA drive out of my current desktop running XP

and transplant it into the mac pro then use it with either VMware or bootcamp. So will this work or will I have to partition my hard drive and buy another copy of XP?
You might run into issues with your license, but that depends on the country you live in. In Germany, the law allows you to transfer a license from one machine to another - and it doesn't matter whether it's an OEM, SystemBuilder or Retail license.
Technically, it could be possible that the installation medium for your operating system won't work on the Apple hardware. Some (but not all) OEM versions actually verify the hardware before the installation. Once the system is installed, however, they no longer care.
In any case, what definitely will happen when you transfer the drive to the Mac Pro is that Windows will scream for tons of new drivers (install Boot Camp in Windows and you're good to go) AND the operating system will demand a re-activation.
You won't have to do anything on the OS X side of things to get this to work. Press Option/Alt after the Mac's system "dong" and you will have the option of either booting into Windows or OS X. Chances are, however, that the system will -always- boot into Windows, no matter what Startup disk you defined in OS X or Windows. On my Mac, for example, I always have to use the boot menu when I want to start my machine with OS X. Don't ask me why, I've given up on it.
I'm not sure if VMWare (or Parallels) will recognize that hard disk as a "Boot Camp partition". It hasn't been partitioned with Apple's Disk Utility (or Boot Camp, which both use the same tools in the background), so maybe a Boot Camp partition is marked with a specific flag, I don't know. But even if the partition is recognized and VMWare or Parallels accept and use it, Windows will probably once again require a re-activation and it will also require the respective virtual machine drivers.
I have two Windows installations on my Mac Pro to solve this issue: One natively on a physical hard disk, and one in a VMWare image. (For Windows XP, you would need two licenses to do this. The Vista Business/Ultimate/Enterprise licenses explicitly allow this kind of dual installation on the same computer.)
Good luck!
