Had similar experiences with Adobe on parrallels in OSx. You can use VMLight instead, but I installed itunes on that and it just crashed without running. of course, you need bootcamp to be able to boot both of these (maybe you could install osx to another hd or something). Forum rumor has it that if you boot first to osx and then reboot into windows 7 that osx will start it for you and then you can use xp mode. But macs don't have 'bioses' so you'll have no way to do this after you install. if you want to use 'xp mode' with windows 7, you have to enable your hardware virtualization in the bios.It will work, but here are a few things I wish someone would have told me:
I did it following the Vista instructions that Joseph posted above.