When I load my Microsoft Office XP software into my new Windows 7 laptop the installation process will not accept my Product Key. Does this mean that I won't be able to use my old software? If so, can I get an upgrade without having to buy the latest version of MS Office?

You should call Microsoft and ask them to straighten it out. From what I know about the systems there should be no problem for you to run older software on Windows 7. The issue might be that MS thinks that you are using the package on more than one machine. Their phone number may be on the back of the sheath that came with the CD.

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.