Thank you all.
No, you do not need to worry about defragging anymore. Windows 7 does it automatically once a week.
That confirms my suspicions, I thought Windows 7 was doing something like that, considering that when I did go to defrag, it showed very low, if any, fragmentation.
richc46, I have seen sites that recommend you defrag once a week, but I never could see the sense of having to put the HD through that every week if you don't add/remove a bunch of files.