OBJECTIVES: I. Determine overall and leukemia-free survival of patients with acute nonlymphocytic leukemia or myelodysplastic syndrome treated with busulfan and cyclophosphamide (low-risk patients) or cytarabine, busulfan, and cyclophosphamide (high-risk patients) followed by allogeneic or syngeneic bone marrow transplantation. II. Compare the therapeutic effects of these cytoreduction regimens with those reported in the literature for similar patients who undergo syngeneic or allogeneic marrow transplantation following cytoreduction that includes total-body irradiation. III. Determine the early and late toxic effects produced by these chemotherapy regimens in this patient population.