Windows XP Embedded
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Windows XP Embedded is the componentized version of Microsoft Windows XP Professional. You can find the XPe home page (http://msdn.microsoft.com/embedded/usewinemb/xp/) on MSDN. XPe is based on the same binaries as XP Pro, but XPe is marketed towards developers for OEMs, ISVs and IHVs that want the full Win32 API support of Windows but without the overhead of Professional. It runs existing Windows applications and device drivers off-the-shelf on devices with 32MB Compact Flash, 32MB RAM and a P-200 microprocessor.
XPe is not related to Windows CE. They target different devices and they each have their pros and cons which make them attractive to different OEMs for different types of devices. For instance, XPe will never get down to the small footprint that CE works in. However, CE doesn't have the Win32 APIs XPe has (although CE have an API that is similar to the Win32 API), nor can it run the tens of thousands of drivers and applications that already exist.
The devices targeted for XPe have included ATMs, slot machines, cash registers, arcade machines, industrial robotics, thin clients, set top boxes, network area storage, etc. Custom versions of the OS can be deployed onto anything but a full-fledged PC; even though XPe supports the same hardware that XP Pro supports (x86 architecture), licensing restrictions prevent you from deploying it to standard PCs.