Can’t do clean install of Windows 7 Operating System

I just bought a refurbished Dell desktop PC that came with Windows XP Home preloaded. I have bought the disc from Microsoft for Windows 7 OS and want to do a clean install on that PC.

When I put in the Windows 7 disc and restart the PC, the cursor will appear for about a minute flashing in the upper left hand corner of the black screen before the machine finally boots to Windows XP Home edition.

Things I’ve tried:

1. Reboot and hit F2 to check the reboot order which is already set to do “Onboard or USB CD-ROM Drive” as the first choice.
2. Reboot and hit F12 to see if there are any other options that make sense (which don’t to me).
3. Reboot in Safe Mode (and then what do I do?)

Here’s my PC’s configuration:

Dell GX280 Desktop
Pentium 4 2.80 GHz
750 Gb Hard Drive
2 Gb RAM

Any and all help will be greatly appreciated.

 

Does the drive recognise and allow you to explore the W7 DVD if you insert it while booted to XP?