I don't think they (M/S) can 'force' you to upgrade to SP2 but they have stopped providing updates for XP pre SP2, so it looks as if we have no choice if we want to keep our XP machines up to date with M/S security features and patches.
There are other altenatives to M/S such as Linux which is free, at least some versions are. I came across something on Ebay last week called Simply Mepis OS click here which is a version of Linux but costs £4.99 (which seems OK) and it looks well cool.
I suppose others will have their own opinions on it but I am considering getting a copy and setting it up on my PC as a dual-boot along side WinXP SP2 to compare the two. As I am beginning to get fed up with the heavy handed techniques of the mighty MS corporation.
It appears that if you change some parts of your PC (including the Mouse) then you will have to buy a full retail version of XP or else fall foul of their terms and conditions because it will then not be exactly the same PC as XP was first installed on. This excludes some parts like CPU and RAM but includes Motherboard and PCI cards.