I'm one of those people who skipped Vista, but upgrading from XP to Windows 7 isn't a supported path. For some old XP to new XP migrations, I used Laplink's PCMover program, and it was flawless. I was hoping Laplink had a new version that would support Windows 7 (they do), but I found something even more intriguing--the PCMover Windows 7 Upgrade Assistant (W7UA). Laplink's claim is you can do an in-place upgrade from Windows XP to Windows 7. W7UA is available at pre-release pricing of $15, so I had to buy a copy and give it a try. It was well worth the money--W7UA literally saved me weeks of work getting my laptop "just the way I like it".
[update]
If you're a Visual Studio 2008 user, hold off on using this. The license information did not migrate (see below), and I've been unable to reinstall VS 2008 on Windows 7. I'm going to revert my machine and try an idea this weekend. I'll post updates here.
[update]
In an ongoing effort to resolve my issues with Visual Studio 2008 migration, I reverted my machine back to XP (using an image I made before starting the previous upgrade process). Come to find out, the license model for W7UA is "one and done". At the step where you enter your serial number, W7UA checks to see how many moves you have left on your license. I am currently unable to try my migration again. I'll contact Laplink and see if they can help me out on an additional move under the circumstances.
The process, in a nutshell
Basically, you install W7UA in Windows XP. You run W7UA, it searches for programs, settings and files it can migrate, and choose what you want to migrate. W7UA then creates a "moving van", which is a file of all the settings and whatnot. W7UA said it would need roughly 35MB free and take some time; it ended up needing 14 MB and 3 minutes. Once the moving van is created, you do a custom install of Windows 7--don't format the hard drive. The Windows 7 installer moved XP from c:\windows to c:\windows.old, then installs itself in c:\windows. You then install W7UA, and restore all your settings. Once the settings have been restored, your good to go. All told, it took about 2 hours or so to make the moving van, install Windows 7, then unload the moving van. A huge timesaver over a fresh install!