you can't do an in place upgrade to the x64 version of windows 7
(i'm nvr a fan of doing upgrades to begin w/, a fresh install leaves a much cleaner system)
I would install Win7x64 on a new partition so that you can move your files over @ your convenience
All of your software that doesn't have a 16-bit installer (aka most software from the late 1990's on) will install just fine. I've used x64 operating systems for the past 4 years or so and have never had a software issue.
If you have some older hardware (scanners, ect.) you may find that the manufacturer doesn't have x64 drivers (i'd check their site first)
I doubt you'll have any incompatibility issues