From what I can tell, the System Reserved partition in Windows 7 should only use around 76 MB of space out of the 100 MB. If yours has more, something else is in there, possibly the XP stuff.
Did you use any special software to set up the XP dual Boot? You might check msconfig.exe and see if you can remove the boot entry from the system. But you still might have other files left over, such as ntldr, it the system was set up that way.
Since I do not know if using a logical partition to install Windows 8 has any effect on where it puts it Recovery files, I suppose I would start with putting a Drive Letter on the System Reserved Partition and finding out what is in there. A list of what I show is a the bottom for comparison. You might also think about changing the partition to primary, just in case it does effect the install regarding the placement of the
Recovery files.
If you have
any questions, post back so we can check the situation.
To assign a drive letter (there is probably a tutorial here somewhere), you start the Administrative command prompt and type
Diskpart. After that you can check the partitions to see which one you want to assign the letter to. So follow the commands below and make sure you are looking at the correct 100 MB partition. This assumes you have one hard drive which would be disk 0 and partition 2 is the partition you need. If you have another drive, make sure and select the correct drive and partition.
list disk
select disk 0
list partition
select partition 2
assign letter="S"
exit
Now use DOS commands to check the partition. A
dir /a command will show the hidden files and you should be able to see what is actually there and remove any unwanted files/folders.
When you are done, open Diskpart again, go through the same set of commands and use
remove letter="S" to get rid of that mount point.
C:\WINDOWS\system32>S:
S:\>dir /a
Volume in drive S is System Reserved
Volume Serial Number is 48C5-65FA
Directory of S:\
10/19/2013 09:09 AM <DIR> $RECYCLE.BIN
04/12/2011 10:11 PM <DIR> Boot
11/20/2010 07:40 AM 383,786 bootmgr
04/08/2010 05:57 PM 8,192 BOOTSECT.BAK
07/23/2013 01:02 PM <DIR> System Volume Information
2 File(s) 391,978 bytes
3 Dir(s) 22,446,080 bytes free
If the folders listed are not exactly correct, such as Recycle bin, it might be because I have the Windows 7 drive in an external dock.