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#11
I can only recommend Partition Wizard bootable CD which has successfully helped hundreds of these types of operations here without fail. But always back up your files and a System Image before any type of Resizing operation as there is a fail possibility.
Why do you want to reinstall current Win7? When you delete XP, you can resize Win7 at the same time to make more space for your new Win7 install, then create and format the partition in that space during the new WIn7 install. There is no reason to reinstall old Win7, just resize it some.
It is best to do the resizing first rather than after you install new Win7 as it lessens the risk by about half. Resizing copies over files in the shrunken space which is extremely tricky. If it fails using PW it simply reboots and starts over until you interrupt it during boot process at which time Win7 will start, as it is preserved at all times.