I will be building a new computer in October or November. I have a version of Windows XP Pro that I can install on the new computer. My question is is it worth it to install XP and buy the Windows 7 upgrade to save $80? or should I just buy the full version? If I ever have to reinstall my OS would I be able to? I heard once you upgrade from XP your XP product code is disabled. Also, what are some pros and cons? Like would there be features I couldn't access because of the upgrade from XP?
There is no direct path from XP to Windows 7 (MSFT call it an "In Place Upgrade" - start from within the old OS, and it preserves your applications and settings.) So from XP, you are looking at a full reinstall.
You can install Windows 7 over XP - It will place your existing data into a folder called WINDOWS_OLD, and you'll be able to retrieve it from there. But you will have to (re)install all of your applications.
Yes, using your XP licence key to validate a Win 7 upgrade is supposed to invalidate the old key.
If you need to reinstall, you will be able to do a complete Win 7 install from the Win 7 disc. Depending on how many activations, you might have to call Microsoft (the number will pop up) and get a new key. Takes about 5 minutes, and at least in the USA the number is toll free.
"...features you won't be able to access because you upgraded from XP"
Pardon the annoyance, but what moron told you this? If you upgrade to Win 7 Home Premium, then you have Win 7 Home Premium and full access to all of that version's capabilities.
Personally, I would recommend watching for another round of pre-release deals on Win 7, and buying an OEM (Full) version. Even if only for the sake of not having to keep the old XP discs around. But I'm lazy like that.
+1 to scotteq. OEM will let you keep your XP license and ensure that you don't need to reinstall another OS before reinstalling Win7. The only reason to buy the Retail for $200 would be MS support (and you have us, right?) or the ability to move it around from computer to computer. If neither of those matter, go with OEM.