The consensus of experts is that Windows 7 is the best operating system Microsoft has ever released. I managed to perform a clean install of Windows 7 Ultimate on an XP PC with no problems whatsoever, but not all Windows 7 upgrades go so smoothly.
In fact, I was getting ready to install Windows 7 Home Premium on a blank partition of my Sony Vaio laptop so I could dual-boot Vista and Win7 but was scared off by a handful of reports of serious upgrade problems. Call me chicken, but I count on my notebook PC and don't want to risk breaking it. (And besides, I don't dislike Vista near as much as many other people do.)
Some veteran PC users postpone upgrading to a new Windows version until the first service pack is released. Unfortunately, service packs often cause problems of their own. Back in 2008, glitches with Vista SP1 caused Microsoft to offer free support, as Suzanne Tindal reported. Microsoft provides the System Update Readiness Tool designed to resolve update problems for Vista, Windows Server 2008, and Windows 7.
You can minimize the chances that you'll encounter upgrade woes by doing two things beforehand: back up your data and save the Windows 7 drivers for your hardware to a removable medium. This applies whether you're doing an in-place upgrade (which preserves your data and settings) or a clean install (which wipes out the current Windows installation).
That's the theory, anyway. There's no guarantee that the official Windows 7 drivers will work without a hitch on your system. Paul Mah of the IT Business Edge reports success rolling back to the Vista driver for a device that balked under Windows 7.
Some Vista users fall into an infinite loop when attempting to install the Windows 7 upgrade. Microsoft provides a Fix-it for the problem on its Support site. Seth Rosenblatt describes in the CNET Download Blog two Win7 upgrade gotchas to avoid.
Microsoft's guide to upgrading to Windows 7 relies on the Easy Transfer wizard, but ZDNet UK's Adrian Bridgwater points out the risks of trusting your data and software settings to an automated process that can be "easy" to derail. (The wizard doesn't bring over the applications themselves, which have to be reinstalled separately.)
I may eventually upgrade my Vista notebook to Windows 7—probably long before Win7 SP1—but only after the early adopters have cleared a path.