Windows 7 actually appears to be worth the upgrade. I got a firsthand account from my roommate, who says it’s combines Vista features with XP efficiency. And for a limited time that upgrade is cheap: $50 for Home Premium and $100 for Professional.
To make it easy on the consumer, each version of 7 has all the features of it’s lesser brethren – no more Home Premium vs. Business vs. Ultimate BS. E.g., since Premium includes Media Center, so does Professional, even though it’s targeted at small business users. Here is a good article comparing the different versions. I think Professional is a pretty clear win (at least for me).
To ease the minds of upgraders, Professional and Ultimate include a fully licensed copy of XP SP3 that runs in a virtual machine. There is one big gotcha, though – not all Intel CPUs support Intel VT (Virtualization Technology), required for this XP compatibility mode. Here is a list of supported (and unsupported) CPUs.
Please comment if you’ve had any luck (good or bad) with Windows 7.