I've searched all over the internet and I've heard yes and no.
This is driving me nuts
You can absolutely install the Win 7 Home Premium you bought on sale. You just can't do an "In-Place" upgrade (this is where you start the install from inside Vista as it's running)
. You can either do a completely clean install, or you can install Win 7 over Vista. If you install Win 7 over Vista, your existing data will be found in a WINDOWS_OLD folder which Win 7 will create for it. You will have to reinstall your programs in either case.
Personally - When my SSD gets here (out of stock until the end of the month)
, I'll be doing a clean install to the new drive and then inporting my data.