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Take an old (or new, 1TB drives are under $99 nowadays) hard drive and install 7 on that... That way you have access to all your files and won't lose anything if you screw it up.

I did it that way and transitioned over slowly... When I remembered something I needed I moved it from the XP drive to the 7 drive, or would boot into XP to run something that wasn't installed on the 7 system, then install it on 7 later... Now I find myself needing the XP drive less and less.
 
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You don't have to worry about partitioning that way, and at first I didn't even need to worry about a bootloader... I just shut down and swapped the position of the SATA cables when I wanted to boot the other OS. :D

Now I'm using Grub4dos to handle OS selection. Much simpler than getting 7 to try and see an OS that wasn't there when you installed it (I disconnected the XP drive completely, but you might not even need that... Install to the new drive with the XP drive connected, and you should have multi-drive booting right in the 7 boot manager).
 
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