Yes you can install Linux After you have installed XP, it is actually better to do it that way.
The only thing you will need is some unused Hard drive space or preferably a separate hard drive for Linux.
I dunno about the DOS RAM thing, can you give us your specs?
Remember to backup your XP before you install Linux, as it can potentially cause your XP installtion not to boot, or it can corrupt your hard drive. Though I have not had any hard drive corruption problems in a long time.
Also if you are going to want to transfer files between Linux and Windows and your Windows Disk is NTFS then you might also want to make a FAT32 partition on the linux drive so that you can put files that you want to access from either there as Windows cant read ext2 or ext3 (linux File System) and Linux doesnt have very good support for NTFS. So a FAT32 or FAT16 partition is useful for that reason.
You can get a program that runs in Windows that allows you to explore and read/write on a ext2/3 partition. I will see if I can get the link and post it here.