Boot the Windows 7 DVD, it will scan the HD to see XP and allow use of Upgrade version key even if you then use Drive Options>Advanced to repartition and format your HD before install.
Use the drivers
given by the installer unless performance dictates otherwise. This is not XPired or Vista - MS spent a fortune getting the drivers into the installer or quickly available via optional Windows Updates. Any drivers missing then in Device Manager can be found on the Support downloads webpage for your computer or device model.
On about 200 Windows 7 installs, after optional Windows Updates I have only had to import an average of about one driver
per install, and only had to change out the chipset about 2 dozen times when performance dictated it.