I would highly recommend that you you work toward upgrading. Until then...

Have you tried to execute the the logon script from a DOS window on XP?
code:
\\server\netlogon\kixtart.exe \\server\netlogon\edc.skr

Does this execute?

NT,W2K, and XP do not use z:\ when executing the logon script.

Do your XP computers display the black DOS window at all when the script should execute?
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