Installing windows 7 upgrade over XP

Hi, I have an early 2008 MacBookPro on which I have successfully installed XP Pro on BootCamp partition and am able to use it with Parallels 6. How ever, the drivers updated with Snow leopard on windows partition fail to provide correct display drivers. I am only able to get some generic display driver that gives 4 bit color. Parallels, however, provides its own and when i use parallels, the XP looks perfect. Anyone had this issue? Also, the BootCamp update on windows partition was at 3.0 but when i boot up windows through Parallels, the BootCamp control center has fewer options to control.
I want to install Win 7 on the same bootcamp partition and from what I read, I cannot use upgrade installer without losing files. I am willing to lose all files on the XP partition as I have just installed it. Is this possible? I already formatted my windows partition as NTFS.

You are asking for trouble going from XP to Windows 7 without the normal Windows clean install.
If it was me and business, I'm not even sure I would use a Mac Mini for Windows 7; or having only one computer.
You might want to look into dual boot XP and 7, but that means either wiping out Mac OS which I assume you actually don't need or use or if you do, could be booted from external.
And backup. Backup data. Clone XP to another drive and then do the swap/exchange.
Excessive downtime always depends on trial and error, experience, and whether someone has done something and had some practice.
Windows 7 Pro has XP Mode too.
I almost always have had backup computers, systems, and able to run two in parallel fashion as a test.
Which brings up an idea. What about running Windows 7 or XP in a VM?

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