You are in the wrong forum. You should post this conversation in one of the Answers Windows 7 forums
http://answers.microsoft.com/en-us
This forum is for issues relating to the Windows 7 Software Protection Platform - Non-Genuine, validation problems, or software licensing services messages. Please don't continue this thread here.
Having said all that, it will work but booting into XP will be destructive to Windows 7 VSS files (Backups, Previous Versions of files, System Restore points, and many others). Vista and Windows 7 volume shadowcopy service files are incompatible with
the XP version of volsnap.sys, the VSS driver. XP's volsnap.sys scans all volumes visible to it as part of XP startup and deletes all incompatible VSS files it finds to protect the user from potentially restoring data from corrupted files. Because
of differences in file formats, XP volsnap.sys does not recognize Vista and Windows 7 VSS files as valid.
The resolution is to hide Vista and Windows 7 volumes from XP by means of a registry key. See
http://support.microsoft.com/kb/926185/en-us
Colin Barnhorst Windows 7 Ultimate x64 on DIY with 6GB ram
