The unallocated area at end of the "Extended" exists because you don't allocate it to a partition? How are you sure that it is really an extended partition? If you mean that the unpartitioned space is inside the second partition because it is listed separately from the 8 MB that Windows XP Setup reserves for the setup process I don't really think so, there is no real evidence for that. I suggest to install Windows once creating the partitions with the Windows XP Setup and then check in the Disk Management Console if the partitions are primary or not. I have installed Windows XP countless times and the partitions were always primary (with one exception which I don't know how it occurred).
Of course you use a modified installation source which may make some difference (Rufus etc.) but yet have you checked that the second partition is really an extended one?