I get this question fairly often. It’s not immediately clear to most what the differences are between the two.
The big bullet features that Windows XP Pro includes that Home does not are:
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- Remote Desktop
- Encrypting File System
- Multi-Processor support
In my opinion, Remote Desktop is worth its weight in gold. XP Pro is my default recommendation for almost everyone.
Microsoft does provide a more detailed comparison at Windows XP: Which Edition Is Right for You?.