"Something likely to hold up use of XP Mode is the shortage of PCs whose motherboards can run virtualized software. Woodgate [Microsoft] said the company also "felt pretty good" about performance of XP Mode on new PCs and old systems "with the right hardware". Windows XP Mode was released to testing in April, and The Reg found that integration of XP applications with W 7 was patchy while legacy versions of Office responded slowly in the virtualized world that ran inside W 7." http://www.theregister.co.uk/2009/08/04/windows_xp_mode_release_candidate/
I believe a much better decision is if you just go with Windows 7. You will get a lot of advantages. This time MS made this right. I collected some info here: http://blog.thstart.com
Leo LaPorte is the guy I pay any attention to at all regarding tech. He's saying that Win7 puts a windows machine on par with an Apple.. I'll upgrade when Leo says it's all not buggy for sure...