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Of course you can use a router with only one IP
address. The router wil take that address and translate
to internal address using NAT for every PC connected
to it. It is commonly known. I am writing from a home
network just doing that.
The router is independent of XP. In other words there
is nothing to do in XP. Generally the router I found use
the browser(Firefox, Opera, etc) to communicate with
it and setting it. Some router companies want you to
believe that there is a need to install their software
for communicating to the router. Usually the router
comes already set to 192.168.1.x subnetwork. And
if you use a PC which does not have a static IP, it
will connect to the router and acquire its home IP for
example 192.168.1.3, then you use the browser to
setting the router. You would need to use the
documentation for the router you bought.