Do i understand corrcetly that a Windows 7 upgrade can be done from a windows xp machine?

If you have Windows XP, then an actual upgrade is not possible. You'll be prompted to perform a Custom (advanced) installation which is essentially a clean install.Carey Frisch

Hi Pyezon, Please note that the Windows 7 upgrade media that will be provided was designed for Windows Vista product upgrades. If you are installing the Windows 7 upgrade on a PC currently running Windows XP, you will need to back up your files, do a clean install of the Windows 7 product, and then reinstall your applications and transfer your files in order to perform the switch to Windows 7.

Will that work like an upgrade from win 98 to win xp? Where you start from a formatted drive, start the install and are asked to insert a win 98 cd? Then the xp install starts from there.