Having lived with 7 for a few months I find that I don't use XP-Mode any more.
The initial interest in XP-Mode was that it was seen as a way of running DVD43 on a 64 bit operating system PC.
Having established that I can easily configure Windows 7 XP-Mode on numerous computers I have concluded that if you want to run 32 bit applications from Windows 7 you are probably better off dong a "clean install" of the 32 bit version on your new Windows 7 computer that was supplied with a 64 bit operating system. Hell! even the computer you are replacing can have 32 bit Windows 7 installed and you can use that to copy DVDs and then play them on your new 64 bit machine!
For more details on this section please see here