XP setup using timestamps in GMT, not local time?

When XP setup runs (complete reinstall), does it normally use GMT timestamps,
i.e., unadjusted for time zone? A few days ago I reinstalled XP from
scratch, (erased all old partitions, reformatted), and just now noticed that
most of the timestamps are wrong on system folders & files, log file entries,
and even a few System Event Log entries. They're off by about 5 hrs, which is
exactly my offset from GMT. Is this normal? Or maybe a sign that I messed
up the installation? (or worse)