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typically, the first account you create with home edition will be given administrator privilages. it is quite unusual that your install allows you to log in as administrator from the welcome screen, since this is not the default behavior with XP home, same goes for the guest account.
yes, using an administrator account to do your day-to-day computing activities is not reccomended per MCSE. however, the reality is that most home users need to be able to install programs and use aplications that end up requiring administrative privilages.
the issue is that often spyware and viruses use the current logged in user's privilages to do their damage to a system, so if the user has administrative privilages the malware can do more damage, though not all of the viruses out there need the local user's privilages to do their damage.
often times an administrator's solution will be to give a user "power user" rights by adding them to the power user's group in computer management, thus giving the user certain elevated rights without giving them full controll to the system. by default windows XP home edition does not allow access to the computer management MMC "users and groups" snap in. however, it is possible to install it from download.
as long as you use antivirus software and spyware utilities, you shouldn't have anything to worry about using an account with administrative privilages. it is good practice to use another account aside from the default administrator account, however. if you use that account and for some reason it gets corrupted and you cannot log in to your system, you are pretty much hosed. usually the default administrator account is left alone unless you need to resolve a severe or specific problem where you cannot or should not use a regular user account.
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