You will have a couple of options, as you own Vista 64bit Ultimate.
We have reports that Windows 7 upgrade will accept Windows 7 RC as a previous OS and install and Activate. Now if MS will accept that is yet to be seen. As long as you know the prerequisites and EULA, don't want you to have any problems later.
You should be able to install it without the hack, I would try it first.
Check this Seven Forums tutorial Clean Install with a Upgrade Windows 7 Version
I don't think I would run it from the desktop, a non-target partition or external HD will work. Install Windows 7 Without Using Any External Device
USB memory key is good also, Windows 7 USB/DVD Download Tool
I would use the external HD or USB key, these are much better than a DVD.