SQL - Insert query Inside another Insert with updated Identity seed

Question

I have 2 tables T1 AND T2

T1 has 10 unique records with a primary key (Identity Seed)
T2 has multiple entires with Foreign Key for each record in T1

T1 has 2 columns : PrimaryKey - DATA
T2 has 2 columns : PrimaryKey - FoeignKey (this FK is the Primary Key of T1)

I need to write a query which will select all the records from T1 and INSERT new entries into itself i.e. T1 ,with the same data,and since PK on T1 is identity seed this will auto generate a new ID, as soon as this new ID is generated I need to JOIN the T2 and INSERT new related records with this new Identity.

I know this will duplicate the data and that is not the concern, this is a one time transaction so the query need not be efficient, but NO Cursors please, it would be best if this can be achieved using SELECT and INSERTS without doing loops using external variables !
Thanks !!

UPDATE : If there is an Entry in T1 does not always suggest that in table T2 there has to be a corresponding entry/entries.

P.S. Im using SQL Server 2005

Answer 1

Assuming that the primary key on T2 is also IDENTITY, use:

-- Populate T1
INSERT INTO T1
SELECT data
  FROM T1

-- Populate T2 with T1 values
INSERT INTO T2
SELECT primary_key
  FROM T1 x
 WHERE EXISTS(SELECT NULL
                FROM T2 y
                JOIN T1 z ON z.primary_key = y.foreign_key
               WHERE z.data = x.data
                 AND z.primary_key != x.primary_key)

Answer 2

If the table doesn't have any current activity on it, something like the following would will exactly duplicate the data. It doesn't have to be dynamic sql - that's just to automate the starting identity seed.

If you have some other data in the tables, you can easily work with this to duplicate that data or join to it.

declare @maxID int

select @maxID = max(pk)
from T1

declare @sql nvarchar(max)
set @sql = 
'create table #T1
(
 new_pk int not null identity(' + cast(@maxID as varchar) + ',1)
 ,old_pk int
 ,data nvarchar(max)
)

insert into #T1 (old_pk, data)
select pk, data
from T1

insert into T1 (data)
select data
from #T1

insert into T2 (fk)
select new_pk
from #T1
inner join T2 on T2.fk = #T1.old_pk

drop table #T1
'

exec sp_executesql @sql