Can anyone tell me the most effective zip programme to use with Windows XP - I know Winzip is available - is there anything that compresses even more effectively?

Winace (http://www.winace.com)
Winrar (http://www.rarsoft.com)

Yeah go for RAR and ACE they have higher compression rate.

RAR is faster and has a far better GUI
ACE is slower but compresses smaller in most cases
However the difference in size isnt huge between them, so i'd go with WinRAR