So -- after days of head-banging, I finally managed to make the system work by:
1) Formatting the HDD & install a fresh copy of Windows XP
2) Downgrading to ML2008

Yup, it worked. I still have no idea why ML2010 won't. But given that I have a licence for ML2010, asking for activation code for a lower version was not a problem.

Will upgrade to ML2014... when I find extra funding.

Cheers,

"Raymond" Byungho PARK