Right, choose firefox over Opera. Its less of a memory hog, more reliable, and has a much more cut down feel to the interface. Also, less compatibility problems with webpages.
It says something for the firefox interface that there is only one change i make after a fresh installation of it on a new PC. I add a "new tab" button to the nav bar. Thats it. The rest is utterly spot on. Its just so refreshing to have a bit of software that works as i want it to, out of the box, with no arsing about.
I'd second open office, assuming you arnt planning on *ahem* borrowing *ahem* a copy of ms office.
I use winrar for compression. it covers all the funny formats which windows XP doesnt. (XP has native support for opening zips)
I use Winamp for music. Its a simple, fully featured music player. It also supports lots of video files, so is a full alternative to windows media player.