Got it last weekend, yay!
Lesson learnt: Avoid buying FreeDOS laptops (Laptops that come with the FreeDOS operating system than the usual bundled OS eg. Windows).
I didn't want to install Windows Vista either, so I opted to install XP myself. Sounds straightforward enough: pop in installer, format HDD and run installation. Except for the fact that even fresh off-the-shelf XP installers does not come with a SATA driver and hence failed to recognize the HDD. Vista installers wouldn't have this problem, but like I said, I didn't want Vista.
After a bit of research, I disabled the native SATA mode in the BIOS settings so that the HDD will run as an IDE. Windows installed, no problem. Then I read in a few forums that Compaq / HP computers were notorious for their lack of XP support. They have a full collection of hardware drivers for Vista on their website, but most were missing for XP.
What's more perplexing is that the XP drivers were available elsewhere on the net. After a fair bit (4-5 hours) of scouring, Phoebe and I manage to get all the neccesary drivers from various websites. What's that about, HP?
Anyway, after much trial and error, I have finally managed to install all the drivers and got all the hardware to work properly. There were a few nail-biting moments especially when I was attempting to install the controllers for the SATA HDD and reboot in with SATA mode enabled.
At the end, I finally got a fully working laptop in 6-7 hours, with no less than 4-5 re-installations. Needless to say, I do not want to do that again...