Just as another datapoint, I haven't had any problem running XX on either the Win7 beta or on the RC. (32-bit)

I seem to remember that back in January when I did a vista -> Win7beta upgrade, Xara wasn't happy afterwards until it was reinstalled. My recent RC install has been clean.

I don't use any of the 'compatibility' modes - either setting appcompt checkboxes on shortcuts or the new 'virtual XP' mode in Win7RC. (The two completely different things seem to be being talked about interchangeably in this thread, which might end up being rather confusing)

I run with UAC enabled, and I don't run Xara as administrator other than once to let it set the file associations.