I can confirm that multiple monitors does work reasonably well under Windows XP.
You may need to switch the main monitor when you want to change between playing games and watching DVDs. I think OpenGL is only supported on the main monitor under Windows XP (I'm not certain, though -- I don't regularly play OpenGL games). And my Radeon VE doesn't like to show DVDs on a secondary screen.
I couldn't get three monitors to run off of two cards (one dual head), but otherwise didn't have too much trouble with multimonitor configuration. Then again, I haven't tried with an NVidia card, and this sort of thing does depend on the capabilities of the drivers.
For my setup (two old Matrox Millenium PCI cards and a Radeon VE AGP card), I put in the cards, opened the Displays panel (or whatever it's called -- the one which lets you choose monitor resolutions and such), clicked on the greyed out monitors, and enabled "extend desktop to this monitor". (I'm doing this from memory, so the option names are likely a little different than that.)
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