I always reinstall Windows at least once a year even if I not having any problems, working with windows after a reformat and a fresh install is like putting a freshly ironed shirt for the first time. A reformat and a new installation gets rid of a lot of rubbish that's been installed on your hard drive that you haven't used for months, it gets rid of all the Spyware and Adware that’s accumulated because you haven't run SpyBot Search and Destroy for a month and your hard disk is perfectly defragged.
However I wouldn’t recommend that any who calls himself a computer idiot to reformat the hard disk, but if you must read the guide that Barney put up and follow this checklist before you do anything!
1)Do you have Windows XP/Vista/ install disc?
2) Have you backed up everything that you need to keep (your Dad’s office files for example, any saved games files that you wish to keep)?
3) Is there someone you can turn to if there is a problem?
What concerns is that you whilst you seem bright enough and keen enough don’t seem to be that experienced. The only real problem I can see is dealing with the Esata hard disk problem (Windows XP doesn’t recognise these types hard disks until you install a driver before the windows setup starts), if your you computer is 3 or 4 years old it most likely running IDE hard disks which makes life a lot simpler as you can just pop in the windows disk and reformat, and then reinstall Windows.