You can choose to have 10.04 overwrite 9.04 or not. It's entirely up to you
and depends on whether you choose to install on the partition you had 9.04
on or not. It's quite "safe" either way, although I think a lot less
confusing to overwrite any previous installation.

There are several reasons an installation may fail. Most commonly it could
be a hard disk fault or a bad installation medium. Much less often it's a
RAM chip error, drive controller fault or defective motherboard. I think
since you have a good XP installtion it's probably none of these.

Can you borrow an Unbuntu CD from a friend that is "known good" having been
used for a successful installation? Have you put your CD in another computer
to see if it will boot to the live CD version of Ubuntu? How old is your
CD/DVD reader/burner? For that matter, how old is your computer? Life
expectancy is unpredictable.

You can check the condition of a hard disk with gparted but unless it's
"old" it probably isn't the problem. How old? Hard Disks can last 7,8, 9
years or more, or fail after a couple of years but most are good for about 5
years. Try downloading and burning some edition of Puppy Linux. It's very
compact and has many useful tools for testing a drive. If it works when your
Ubuntu CD didn't it tells you something...

Never give up, but don't let it get you down if it doesn't work the first
time. Treat it as an unparalleled learning experience!