I never did play Squadrons. I joined the Army right after the X-Wing era and had a several year gap where I didn't touch a computer at all.
Now that I think about it, if these are straight-up DOS games then you don't need Windows at all. You can just load MS-DOS and then run the game straight from the command line. I think you're right that XP broke a bunch of old DOS games. It's been so long that I completely forgot we were mad at Microsoft for the removal of DOS back then and the move to an emulator only experience.