I got it to work...finally.
First I installed the new 4.2.0 drivers
that "jridpath" posted a link to. After they were installed I plugged in the phone, and immediately it recognized the phone and started charging.
THEN, I started the PhoneTools application. It didn't immediately recognize the phone but it recognized it enough to ask me if I wanted to download software updates. (There were about 4 of them in my case, and most of them were pretty big.) I let it finish doing all of the software updates, then I rebooted my machine. When it came back up I launched the PhoneTools app again, and THIS TIME it came right up, recognized the phone and works like it did in XP.
Maybe that will work for you.