Today I spoke with a Microsoft tech in charge of helping large customers migrate from Windows XP to Windows 7. One of the interesting things he said was that Windows 7 was indeed tweaked and slimmed down to run on lower powered computers than Vista. Let's talk about that, and how Microsoft has a utility to help you load Windows 7 on your netbook.
My Microsoft contact said the most common desktops they see in large corporations is an Intel box with at least a 1GHz CPU, 1GB of RAM, and a 40GB hard drive. That level of horsepower, and above, has been the corporate standard for cubicle dwellers for several years. Often found in a small form factor case, these systems are popular on the off-corporate lease resale markets as well, although many have just 512MBs of RAM. I have bought a half dozen of these type systems over the years for my home network lab, and each one has worked great with no problems at all. They're also great platforms for running a Linux operating system, as is the one I'm typing this on.
One consequence of netbook's small size is the lack of an optical drive. This means you can use a CD or DVD to load software onto a netbook, at least not without copying the files to a network or USB drive. Microsoft now makes that easy, as you can read about in Microsoft Unwraps Netbook Windows 7 Upgrade Tool. I haven't upgraded my netbook yet, but I think I'll wait and get one of the new netbooks with Windows 7 installed. Personally, I don't think upgrading your netbook to Windows 7 is a priority, but I've spoken to people who have done it and they're happy with the upgrade. Add in the fact that Microsoft is making this easier, and the questions about whether Windows 7 can work on netbooks seems to be answered.
While nice, these Windows 7 tricks don't change my recommendation for the majority of small business computers: don't upgrade to Windows 7 except when you buy new computers that include Windows 7. And if you want to avoid Windows 7 and Vista, keeping XP, most of those off-lease corporate systems come with valid Windows XP licenses.