The Google Chrome OS is going to be aimed primarily at mobile and ultra portable devices. For the foreseeable future, Google isn't planning to go toe-to-toe with Microsoft despite what certain sensationalist headlines might suggest.
Whilst I will admit that I am a stickler for XP, I have been trying out the Windows 7 RC on one of my machines and I have to say, I've been really pleasantly surprised by it. Having tried Vista, which left me thoroughly unconvinced, Windows 7 feels like a completely different kettle of fish. Compared to Vista, my experience of it feels fresh, fast and fluid - everything that Vista isn't. It's also got a no-nonsense vibe to it too - paths to functions feel more logical and intuitive than they did with Vista.
Despite being based on the same kernel as mentioned earlier, 7 is clearly an optimised and enhanced overall experience. Many tests show that boot-up times have been cut in half compared to Vista, and whether or not that is true on my system, it certainly feels a lot faster. Native hardware support is also very impressive. The Vista update advisor was riddled with warnings about stuff that wouldn't work, whereas the Windows 7 one showed me 2 warnings, both of which it informed me would be fixed by using the automatic update feature. It was right.
So, whilst I will heartily praise XP for being stable, mature, tried and tested, if you DO have to go for a new MS offering, 7 Home Premium and up is definitely the way to go from what I've experienced.