Windows 7 RC users will be able to install Windows 7 Upgrade discs
There's a lot of confusion because in the same breath they allow it, they say "but you can't do an Upgrade" with your upgrade disk!
What they mean here is that you have to do a clean install using the "Custom" choice which always appears on an install disk. But they no longer (since XP) allow you to just put your XP/Vista key in, instead you are required to start the Upgrade from the qualifying activated XP/Vista/RC OS.
Some are holding out hope that you can boot the Upgrade disk for a clean install, but MS Technet says there is no way to read the qualifying activation except from the OS itself and not boot.
However you can get a clean install from an Upgrade disk by installing to another primary formatted partition, or another primary formatted HDD. This effectively makes the Upgrade worth the same as the retail for people who want clean installs to fomatted metal and have an XP or Vista that they don't mind saying goodbye to, because the future arrives tomorrow!