Windows XP does not natively have software to decode DVD video (thus the garbled video). You need to install a third-party DVD codec. Typically with Compaqs it came with PowerDVD or WinDVD that, once installed, allows you to view DVDs using their viewer or even media player.
Look through your CDs that came with your PC and see if there is one for WinDVD or PowerDVD and install it. Sometimes it will be on a CD labelled drivers or additional software.
Hope this helps,
-Tor
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