To me, it sounds like the driver for the card reader isn't working correctly. My advice would be to uninstall the driver from XP, reboot the computer and make sure everthing is working fine.

Then turn the computer off, plug in the card reader (I know plug and play but bare with me), then turn on your computer and let it find the card reader as it starts up. Let it install the driver it thinks is correct for the card reader and take it from there. Sometimes the driver that the Gates Almighty deams to be correct, is not correct and when you install the driver for the actual card reader it confuses windows.

Do you know how to check to see if there are any confilicts on your computer ?