That folder is part of the WindowsImage Acquisition, and is used for scanning somehow...
In addition to "xerox", there is also a "microsoft frontpage" and a "msn gaming zone"-folder created each time you start Windows. Same thing, they are locked, so you can't delete them and they will be created each time you reboot.
There is a solution though. However, this is REALY NOT something to do when you don't know what exactly everything means and is. It is a RISKY thing todo if you don't know EXACTLY what you are doing... NOT FOR N00BS (sorry for the use of that word):
You can disable the Windows File Protection System (Windows 2000/XP) by following these instructions:
http://www.overclockersclub.com/guides/disablesystemfilechecker.php
or
http://www.winguides.com/registry/display.php/790/
Then, after you reboot, you are able to remove those folders. But be very carefull as disabling the WFP also removes the protection for critical system files and depending on your knowledge of windows this can be a good thing or a bad thing!!!
Best thing todo is leave those folders where they are, they don't harm you and are a part of Windows; It's not like they are the only folders on your HD that have no purpose (thinking of all the crap that accumelates over the years on a HD)...
/ 
