"Upgrade" has more than one definition, so many people are understandably
confused. :-0
First of all, since you have a qualifying OS (Windows XP Pro), there is no
need to spend the extra money on the Full version; the Upgrade version
(and the accompanying license) will do just fine.
Second, what are you interested in -- an *in-place* upgrade, wihch means
everything of importance stays intact and there is no need to reinstall
your programs? If so, the only way to do this is first perform an in-place
upgrade to Vista, and *then*, perform an in-place upgrade to Windows 7! It
will be more work and more money.
Or do you wish to *migrate* to Windows 7? That is how most people will
move from XP to Windows 7. This is essentially a Clean Install of Windows
7 (your only option if you take Vista out of the equation), where there is
a wizard that will export your data (and certain settings, I believe). But
you would still need to reinstall all your applications.
Even if it were easier and cheaper to upgrade (everything, including
applications), IMO a Clean Install is the better route, anyway.
For more info:
http://windows.microsoft.com/en-US/windows7/help/upgrading-from-windows-xp-to-windows-7
In order for this to work, you need to have XP installed on your PC since
this is what the process requires to verify you have a qualifying
operating system. For those who want to install Windows 7 to a new (bare)
hard drive (and don't want to waste their time with installing XP first),
the so-called "double-install trick" that worked for Vista apparently (and
surprisingly!) also works for Windows 7:
http://www.winsupersite.com/win7/clean_install_upgrade_media.asp