Avisynth is just a Frameserver which works in the Background and provides video/audio stream data to the Softwareplayer or Encoder.
So that kind of stream provided by avisynth has to be understood by the system. If a stream is provided in YUY2 or RGB24/23 then this will be no Problem for the system to decode as such colorpaces are supported by the decoders delivered with windows.
BUT... if your via Avisynth frameserved Stream comes in YV12 the you have to install a codec which is able to decode such a colorspace as Windows originally doesnt support YV12 decoding.
So do install for instance the XVID codec and your Avisynth Scripts with YV12 output will be decoded and shown correctly.
MY clear advice to you (just in case):
DONT install codecpacks! As your video workouts could be messed up and conflicts could be the result. So as you are in the happy state to have a fresh installed WinXP just install ONLY what you need. And XVID for Avisynth handling is enough.
If you want play back mpeg2 files so do use WinDVD which also installs a good mpeg2 decoding directshow codec and all Directshow players will work properly if mpeg2 is feeded.
In case of AC3 decoding, whatch out for AC3filter as its working excellent.
Maybe too much advices but I still remember where Ive been through in the far past.