The upgrades use a prior license and since there are none you need the full version.
For price, most can get by with Windows 7 Home Premium. Here's one at newegg.com
Bear in mind I will not discuss license issues. I suggest we don't ask, don't tell and say you bought it with the PC.
Next you'll find out you need Windows 7 drivers for the rest of your PC.
I have an unregistered version of Windows XP on my computer which I had built for me (long story!). I want to upgrade to Windows 7 but I don't know which program to choose .. there are so many options and I am totally confused! Any help would be very much appreciated.