To nitpick, you want it to say "ACPI Multiprocessor PC". This process will change the HAL (Hardware Abstraction Layer) to the multiprocessor version, which Windows XP Pro supports. For some unfathomable reason, whoever installed the OS didn't make the 2
nd processor visible to the OS (either by not enabling it in the BIOS, by physically removing it, or by installing while connected to a different motherboard).
Incidentally, speaking of using dual processors, various Windows NT 5 versions have different ways of treating this situation. 2000 will allow up to 2 processors (real or virtual) for Professional, 4 for Server, 8 for Advanced Server, and as many as you feel like paying Microsoft to validate for Datacenter Server (currently 64, as far as I know). XP, however, works differently: it can distinguish between real and virtual processors, and counts a single socket (even with dual cores) as a single physical processor. So XP Home can see one physical plus one virtual (or twice that for dual cores), and Professional can do 2+2 (or 4+4). Server 2003 works similarly, with more capabilities as you pay more and more for the software. By all accounts, NT 6 (Vista and Vista Server) will work similarly.
If you have any problems with this, might I suggest asking on the
2cpu.com forums. They'll be able to give you precisely the information that you need.
But, dual 500s? That's not going to be too fast...any Turion or modern Celeron will absolutely smoke it, multithreaded or not.