Are you installing straight from Win7, or are you trying to use virtual mode? You should be able to install any XP software from within virtual PC mode. Try this:

START > All Programs > Windows Virtual PC > Windows XP Mode

You will see a small toolbar on the top of the screen that has options such as "Action" "USB" etc. You will have be patient getting the USB to read the different ports on your laptop/PC, but it should eventually figure it out.