It is possible to move it from machine to machine on removable hard drives (albeit a disclaimer here, where I see this done, they qualify for the corporate edition of winXP, so no WPA). Specifically, the school pays about $16 million for a site liscense with Microsoft for any and all MS software they might use...
In the networking lab where I've had many of my classes these past so many years; they have removable hard drive bays in each of the computers. Course, all their computers are the same make/model, albeit not all the cards that have been added to them are the same (for instance some have 2 NICs, and others only 1, and some have a newer addon graphics card, above what's integrated in the mobo, whereas others don't).
Pretty much, it's not even installed on each comp. There's a Ghost image for the lab, and it's just burned over to enough installable hard drives to cover all the boxes. Course, that's seperate from student disks where we might have other things we were setting up in our classes.
All said (and the networking lab didn't pose as many differences from one box to another, that a major system upgrade would), one is better off doing a clean format...