The UNEXPECTED_KERNEL_MODE_TRAP bug check has a value of 0x0000007F. This bug check indicates that the Intel CPU generated a trap and the kernel failed to catch this trap.
This trap could be a bound trap (a trap the kernel is not permitted to catch) or a double fault (a fault that occurred while processing an earlier fault, which always results in a system failure).
0x00000008, or Double Fault, indicates that an exception occurs during a call to the handler for a prior exception. Typically, the two exceptions are handled serially. However, there are several exceptions that cannot be handled serially, and in this situation the processor signals a double fault. There are two common causes of a double fault:
A kernel stack overflow. This overflow occurs when a guard page is hit, and the kernel tries to push a trap frame. Because there is no stack left, a stack overflow results, causing the double fault. If you think this overview has occurred, use !thread to determine the stack limits, and then use kb (Display Stack Backtrace) with a large parameter (for example, kb 100) to display the full stack.
A hardware problem.
So a hardware problem can cause it, but so can an infection or bad sectors on a hard drive and a system file is on a bad sector.
So now that we tested memory we can cross that off the list and keep going through a process of elimination
Now I noticed in the log that you posted that it wasnt always the atapy.sis but also a few other files with all the same error.
So a couple of questions
1. have you ran chkdsk c: /r on the system yet to check for bad sectors?
2. Have you ran combofix.exe and tdsskiller.exe yet?
Reason why I ask is on the xp machines I found a lot of infections and rootkits that infected the atapi.sys, and so it would cause a blue screen.
You said the problems where happening before you replaced the dvd drive, so we know that isnt the cause.
have you also made sure to get all the current updates for XP? There was a lot of updates after sp3 and a lot of bug fixes. Even though MS doesnt support XP the updates are still online to be donwloaded, they simply are not making any new updates.
Shane