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if you use the registration code in the XOOPS core files, you could probably create a php file that generates an actkey (but this is only needed for the registration process, and as your users already are registered you can probably leave it empty, not sure tho -you can check this by manually adding a new user in the system admin. edit user page and see if it adds an actkey or not), and can encrypt the passwords. XOOPS stores MD5 hashes of the passwords, so if you want your members to use their old passwords, you'll have to hash them and store the hash value.
I'm not a coder, but a custom php file should be able to generate an actkey and hask the passwords and store both for you.
Herko