Windows 7 upgraders guide: The simple version
First, let's spell out the important terms.
In-Place Upgrade: means one you can run from your current Windows desktop. If f you currently own a laptop or desktop with Windows Vista Home Premium you will be able to boot up your computer as normal, pop in your Windows 7 Home Premium disk, and upgrade Windows. Your existing data (music, pictures, etc.) and programs are automatically moved.
Custom Install: "Custom" here really means "new," "fresh," or "clean." When you finish installing Windows your new desktop will be pretty bare - none of your old programs of data will be there, so you'll need to back them up first. Custom installs can't be performed from your existing Windows desktop. You have to force your system to boot from the Windows 7 DVD instead.
We'll take a thorough look at doing just that in an upcoming DLS 101 post.
Windows XP and Vista Starter can't be upgraded: You can probably still install Windows 7, but the in-place upgrade is not an option for any version of Windows XP. All moves from XP to Windows 7 must be done through a custom install. It's also worth pointing out that Vista Starter Edition was never made widely available in developed nations.
32 and 64-bit: Windows XP and the many flavors of Vista are available in 32 and 64-bit versions. If you are planning on doing an in-place upgrade, you must purchase the same bit number Windows 7 as your current Windows Vista.
Upgrading to Ultimate: Any version of Windows Vista (except Starter) can be upgraded to Windows 7 Ultimate.
Vista Home Basic, Home Premium, and Business upgrades: If you aren't upgrading to Ultimate, you have to match things up. Both home versions can only be upgraded to Windows 7 Home Premium. Vista Business can only be upgraded to Windows 7 Professional.
One last word on custom installs: No need to worry about matching here. If you're booting from a Windows 7 DVD and doing a new Windows install, the restrictions in the upgrade chart don't mean anything to you.