I am buying an HP Mini 10.1" Netbook (210-2150NR) with 250GB Hard Drive,1GB Memory that has Windows 7 Starter installed. Can I replace that Windows 7 with XP?
You may. BUT:
You will need to have a Windows XP CD with a Windows XP Key. Microsoft has stopped selling Windows XP long back. And you cannot downgrade Windows 7 to Windows XP since you are not a corporate customer.
However if you have an older copy of Windows XP lying around you can surely load up Windows XP by clean installing or dual booting.
Also if the laptop has SATA harddisk, then Windows XP may not detect it. You will a Windows XP CD provided by a company like HP or Dell since they add the SATA drivers to the XP image before providing it to the end customer.
If you have a Retail copy of XP (non-OEM, non-Upgrade) you can install it if you like (provided it's not installed elsewhere at the same time).
If the hard drive is not detected, you may be able to use a "legacy" or "compatibility" mode in BIOS for the hard disk or you may be able to download appropriate drivers from HP's site (but I don't think HP likes supporting their products, so they may not offer XP drivers). Once downloaded, you can incorporate them into a new install CD using a tool like nlite