Hello Mictee,
In order to run an "in place upgrade" (aka repair reinstallation) on an installation of XP that has SP3 applied, you have to use an XP installation disc that has SP3 applied to it.
Download a free utility called "nLite" to acomplish the task of integrating SP3 with your existing installation disc to make a new installation disc that will work to repair an XP installation with SP3.
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