Just remember once the XP boot files are copied over to the 7 if you set the 7 drive as the host/boot drive the boot.ini file itself will still point at C not the XP and will need an edit to correct the "rdisk(?)" entry from "rdisk(0)" to "rdisk(1)" provided the 7 drive is seen as Disk 1 not Disk 2.
That will be found in the line under "operating systems" when going to edit the copy not the original boot.ini file you then see at the root of the 7 drive.
You'll know when going to select the XP entry if you decide to add one into the 7 boot options. When editing and going to save the boot.ini file you will need to uncheck the read only box and save it as "all files" since NotePad the default edit when double clicking on the file will want to save it as a text file instead.