1.) You can label the new drive/partition B: if you want without issue.

2.) You can only perform a clean installation by booting to the DVD, not by launching the installer from within Windows.

3.) An upgrade license is for upgrading (replacing your previous version entirely). You may not use it to install Windows 7 alongside that copy of XP. Thus, you proposal is prohibited.

4.) You are correct: you can access files across OSes/drives, but must install most programs under the OS you wish to run them from.

Hope this helps,
John