It may have been five years old, but it's still a 12GB drive. That's not necessarily something to throw away, and it does just fine sitting as a secondary HD on a machine. Or even a tertiary one, if there's also a 30GB in there too.
I'd be inclined to install the 200GB (as two partitions), install the 12Gb, and copy everything from that one over to the 200Gb. A standard mobo should support four IDE-type devices (3 HDs and the CD/CDRW/whatever). If there are too many, take out the 30GB temporarily to retrieve what was on the 12GB. Then take the 12GB back out, and put the 30GB in.
A 500MB drive, I would throw away. You can't do anything with it today. But a 12GB drive? Both my kids' computers have 2GB drives in them, so 12GB would be a definite upgrade
Side note: anyone wanna take bets on whether Morgeruat survives the week, now that RevRuby knows what he's done to her computer?