Official Microsoft support for Windows XP professional ends on April 8th, 2014, but no bug fixes nor new software will be released for XP (since April 2009), only security patches. Office 2010 was released with support for XP SP3 (only x86, not XP x64 or Server 2003), but it was an aberration (likely due to the fact XP was still the world's most popular OS at the time, and Office the world's most popular office suite) and the next version of Office will not support XP, and we've already seen IE9 not support XP.
Also, and further to your question, XP has dropped it's market share from almost 59% of the entire OS market in May 2010 to just a hair over 45% in May 2011 (and shrinking at about 1.2% per month), whereas Windows 7 is up to 34% in May 2011 (up from 13% in May 2010) and growing at about 1.75% per month - meaning it will take over as the most popular OS in 4 - 6 months if the numbers stay relatively the same month over month.
Your hardware is fine for Windows 7 - even that GeForce 7300LE will get over a 3 in the Graphics and Gaming scores for the Windows Experience Index, more than enough to run Aero fine on a single monitor without issue. If you can get a copy of Windows 7 cheaply, it's probably worth the upgrade from XP if no applications are holding you back. You probably want to wait on new hardware for Windows 8, as that's a good excuse to upgrade