Photoshop thrives on lots of ram, particularly, more than 4gb.
A 64 bit OS is necessary to access more than 4gb, therefore plan on a 64gb OS. Windows-7 is much better than any of it's predecessors, so I would plan on that. For most users, Windows-7 home premium will be all you need.
There are some other advantages to 64 bit windows, increased security features comes to mind.
The only negative to a 64 bit OS is the inability to run some old 16 bit software.
XP is no longer supported. It is no big deal to learn W7, and you get some very nice things added.